Avoid Financial Pitfalls When Buying A Home

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Avoid Financial Pitfalls

When you buy a house, you enter into a long-term financial obligation. You fill out papers and sign legal documents based on those papers. It’s important that you understand your responsibilities so that you won’t be a victim, or a participant, in a fraud.

When you apply for a mortgage loan, every piece of information you submit must be accurate and complete. Anything less is considered loan fraud.

Unfortunately, there are people who may try to convince you to lie about your qualifications so that they can illegally make money at your expense. These people will appear to be your friends, saying that they’re trying to help you. They may downplay or deny the importance of complying with the law and suggest that it’s all just “red tape” that everyone ignores. Don’t allow yourself to be fooled.

Be Smart

  • Before you sign anything, read and make sure you understand it.
  • Refuse to sign any blank documents.
  • Accurately report your income, your employment, your assets, & your debts.
  • Don’t buy property or borrow money for someone else.
  • Disclosure of loan terms is not just a formality. It’s the law and you have the right to know.

Be Honest

  • Don’t change your income tax returns for any reason.
  • Tell the whole truth about money gifts.
  • Don’t list fake co-borrowers on your loan application.
  • Be truthful about your credit problems, past and present.
  • Be honest about your intention to occupy the house.
  • Don’t provide false supporting documentation.

Don’t Be Discouraged

  • If your loan application is rejected, find out what the problem is and how it can be resolved. Maybe you need to look for a less expensive house, or save more money. Check to see if there are any affordable housing and community programs you might be eligible for to help you through your home buying process.