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Avoid these financial mistakes when buying a home

11/21/2023

Buying a home, especially for the first time, can feel like a daunting task. There are many things you need to do before you can confidently make an offer on a home, especially in a fast-paced environment like the Silicon Valley. Once your offer has been accepted you'll likely be excitedly counting down the days until you can move in and start your life as a homeowner. So even if you've been pre-approved for a home loan avoid these financial mistakes during the home buying process. Here are the top 5 financial mistakes you'll want to keep in mind.

1. Don’t quit your job or change careers
Seems obvious, but you'd be surprised how many people make this mistake. The problem often occurs after a home buyer has already had their offer accepted. There's a false sense of security that things are locked-in once a ratified agreement has been established. However, the problem isn't with the seller's side it's with the lender. Mortgage lenders real work begins once you get into contract, meaning, they're still vetting you and your ability to repay the loan they pre-approved you for. A lender wants to ensure you have stable income and employment and that you can afford to repay your mortgage. Any changes to your employment status can cause major delays to escrow or, worse, cause you to back out altogether.

2. Don't open new credit cards/lines of credit or max out your current credit limits
This is the one that trips people up the most. It seems like having more available credit would be a good thing, but any changes to your overall financial situation can be red flags for the lender. Applying for a new credit card or even requesting an increase on an existing card will result in a "hard" inquiry on your credit, which can wind up lowering your credit score, which is a function of your home loan approval and interest rate.

3. Don't apply for other loans (education, cars, solar, furniture, home equity lines of credit, etc.)
One of the most exciting parts of becoming a homeowner is furnishing and decorating your new abode, but please wait to make any purchases or apply for store credit! For the same reason as above - this can have a negative impact on your credit score. Furthermore, a new loan for a car, an expensive couch, or even major home appliances will change your "debt-to-income ratio" or DTI which is an important qualifier for the lender. This includes co-signing for someone else's loan(s), even if they are the primary lendee, once your name is attached you become financially liable and the debt you're agreeing to back becomes part of your DTI.

4. Don't consolidate debt
It may seem like a positive thing to consolidate debt and it's true that over time debt consolidation can help making it easier to make payments on time which will improve your credit score and reduce your overall debt, however, debt consolidation can have a detrimental impact on your credit score. This is because taking out a new loan and closing multiple accounts in a short period of time appears risky to credit reporting bureaus as well as a mortgage lender's underwriter, the person responsible for thoroughly analyzing your finances.

5. Don't move money around
In mortgage underwriting, large movements of money can be a red flag. Avoid making large deposits or withdrawals from your bank accounts or other assets. If lenders suddenly see unsourced money coming in or going out, it might look like you got a loan, which would impact your debt-to-income ratio.

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Living in San Jose, CA the heart of Silicon Valley

11/4/2023

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San Jose, California, often referred to as the heart of Silicon Valley, is a city that boasts a unique blend of tech innovation, cultural diversity, and a thriving lifestyle. As someone who has had the pleasure of living in this vibrant city, I can attest to the fact that San Jose offers a little something for everyone.

Silicon Valley innovation:
San Jose is at the epicenter of the technology revolution. It's home to some of the world's most renowned tech giants, including Apple, Google, and Facebook. The city's dynamic atmosphere is a testament to the endless possibilities and innovation that occur here. For tech enthusiasts, there's no better place to be.

Cultural diversity:
San Jose's rich cultural tapestry is a significant highlight. The city is a melting pot of cultures, with a diverse population that contributes to a vibrant and inclusive community. You'll find a wide array of international cuisines, cultural events, and festivals throughout the year, providing an opportunity to explore and appreciate different traditions.

Outdoor activities:
If you're an outdoor enthusiast, you'll love San Jose's climate. The city boasts nearly 300 sunny days a year, making it perfect for those who enjoy hiking, biking, or simply soaking up the sun. Nearby, you'll find picturesque parks, including Alum Rock Park and the Santa Cruz Mountains, where you can escape the city's hustle and bustle and connect with nature.

Culinary delights:
San Jose offers an array of culinary experiences. From gourmet restaurants to food trucks and everything in between, you can explore an array of international flavors. There are a number of original restaurants as well as plenty of chain locations tucked into various strip malls and corner stops -- but one thing's for certain -- whatever cultural cuisine you're after, San Jose for sure has it!

Museums & attractions:
The city is home to a number of cultural attractions, including the San Jose Museum of Art, the Tech Interactive, and the Rosicrucian Egyptian Museum. Whether you're interested in art, science, or history, there's something to inspire and educate everyone. There are a plethora of parks scattered throughout San Jose as well, making it a suburban sanctuary for families, with a kid-friendly area to play in almost every sub-neighborhood.

Education and innovation:
San Jose is also known for its exceptional educational institutions. San Jose State University, along with the many nearby colleges and universities, attracts students from all over the world who come to study and be part of the region's dynamic innovation ecosystem.

Diverse neighborhoods:
The city's neighborhoods offer distinct personalities. Whether you prefer a lively downtown scene with modern lofts and high rise buildings, the rolling hills of East San Jose or Almaden, the small town appeal of Willow Glen, newer construction along Communications Hill, or the historic charm of the Rose Garden and Naglee Park, you'll find a community that suits your lifestyle.

Easy access to the rest of the Bay Area:
Living in San Jose also means you're a stone's throw away from the iconic attractions of the Bay Area such as San Francisco, Napa Valley, the stunning coastline from Santa Cruz to Half Moon Bay, and the dense redwood forest of the Santa Cruz mountains. Are all within reach, making weekend getaways and day trips a breeze.

Cost of living:
All this prosperity comes with a significant cost of living. San Jose consistently ranks as one of the most expensive places to reside in the United States. Housing costs, in particular, are exceptionally high, that are barely affordable for local incomes. Additionally, the overall cost of living, including transportation, groceries, and entertainment, can be significantly above the national average. While San Jose offers a wealth of opportunities and a high quality of life, potential residents should be prepared for the financial stretch that comes with the city's allure.

In conclusion, living in San Jose, California, is an experience like no other. With its technological prowess, cultural diversity, outdoor activities, and a genuine sense of community, this city offers an alluring mix of opportunities and a high quality of life. If you're looking for a place that's at the forefront of innovation while embracing the beauty of everyday living, San Jose is undoubtedly a city worth considering.

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