Owning a home is one of the biggest investments you can make in your lifetime. So they say! For some owning a home is not an investment at all. We Buy Houses Cash Dallas, is an investment company and we consider buying houses for the purppose of profit, is an investment. However, owning the “wrong home in Dallas can damage” your credit significantly.
This is especially true if you are struggling to pay your mortgage or if you have purchased a home that is too expensive for your budget, simply because it looks good to you and your spouse. In our weekly blog post from We Buy Houses Cash Dallas, we will discuss five ways owning the wrong home in Dallas can damage your credit.
1. Late Mortgage Payments
One of the most significant ways owning the wrong home in Dallas can damage your credit, is through late mortgage payments. If you are unable to make your mortgage payments on time, your credit score will take a hit. Late payments stay on your credit report for up to seven years and can significantly lower your credit score, making it harder for you to secure credit in the future.
With that said, many people go into buying a home with good credit, but they can for see having problems on the horizon, with making payments. To those people, don’t go buying a home when you know your near future will have issues with making on time mortgage payments. We Buy Houses Cash Dallas, buys many houses from homeowners that get into missing mortgage payments and try to sell their home prior to foreclosure.
If you are unable to make your mortgage payments, you risk foreclosure. Foreclosure is a legal process and occurs when the lender takes possession of your home because you have failed to make your mortgage payments. Foreclosure can stay on your credit report for up to seven years and can severely damage your credit score. In addition, having a foreclosure on your credit report can make it difficult for you to secure credit in the future.
So, when you buy a new home, it can still be the wrong home in Dallas and can damage your credit score, while making other payments for things that may not be as important. People need to take and assess what is important to them as far as credit is concerned. Going into foreclosure just after buynig a home is not a path anybody should take. We at We Buy Houses Cash Dallas, see this pattern happening more today than ever before.
3. Short Sale
If you are underwater on your mortgage (meaning you owe more on your home than it is worth) and are unable to make your mortgage payments, you may need to consider a short sale. A short sale occurs when you sell your home for less than what you owe on your mortgage. While a short sale can be a better option than foreclosure, it can still damage your credit score. A short sale can stay on your credit report for up to seven years and can make it difficult for you to secure credit in the future.
At We Buy Houses Cash Dallas, we purchase homes as they go into the Short Sale process. Keep in mind, a short sale is only to help the homeowner get out of foreclosure. Many times the lender will not approve a short sale and the foreclosure process will continue. This happens when you buy a home, it can still be the wrong home in Dallas that will damage your credit and get into problems you probably don’t understand.
4. High Mortgage Payments
If you purchased a home that is too expensive for your budget, you may struggle to make your mortgage payments each month. This can lead to missed payments, late payments, and even foreclosure or short sale. In addition, if you are using a significant portion of your income to pay your mortgage, you may not have enough money left over to pay your other bills. This can lead to missed payments on credit cards, car loans, and other financial obligations, which can further damage your credit score.
Buying a can hurt you credit, espicially when you buy the wrong home in Dallas will damage your credit when you already miss other payments on credit cards or even utilitites bills. Why people do this is beyond me.
5. High Debt-to-Income Ratio
If you are using a significant portion of your income to pay your mortgage, you may have a high debt-to-income ratio. Your debt-to-income ratio is the percentage of your income that goes toward paying your debts each month. If your debt-to-income ratio is too high, it can make it difficult for you to secure credit in the future. Lenders may see you as a high-risk borrower and may be less likely to approve your applications for credit cards, car loans, and other financial products.
Owning the wrong home in Dallas can lead to significant damage to your credit. Late mortgage payments, foreclosure, short sale, high mortgage payments, and high debt-to-income ratio can all damage your credit score and make it difficult for you to secure credit in the future. If you are struggling to make your mortgage payments or are considering purchasing a home, it is important to carefully consider your budget and ensure that you can afford the home you are purchasing. By doing so, you can avoid the pitfalls of owning the wrong home in Dallas that will damage your credit score for the future. Would a fast sale of your Dallas home help you to resolve the issue? Our team can help! Reach out to We Buy Houses Cash Dallas, today to learn more! Call us at (214) 723-1304.