Buying with Covid-19

Home Buying in the Age of COVID-19: Should I Push Forward or Press Pause?

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The novel COVID-19 virus has sent many of the things we knew straight out of the window. New regulations are released every week, and no one can say what the future might look like once this virus is under control.

Now, with the impact of the pandemic on real estate, buyers may wonder whether or not it is wise to push forward with a planned home purchase. On one hand, mortgage rates are at an all-time low and some sellers may offer incentives to close sales this season. Conversely, uncertain economic times may leave more people vulnerable to unemployment, which means mortgages would be risky.

If you’re wondering what to do about your own buying journey, the answer will be unique to your own circumstances. Use these tips to help you decide whether or not purchasing a home during this pandemic works for you:

Income vs. Asset Changes

How is your investment portfolio? If your workplace has been temporarily closed or some of your investments have lost momentum, your loan application or pre-approval may be denied because your credit score also declines. Will you be able to afford a home loan in your new circumstances – and if things get much worse? If you still have a plan to pay your loan, you can go ahead and make an offer. 

Lender Requirements

Even though mortgage rates are lower, lenders have become more cautious in the wake of the pandemic. If you were in the middle of your application, and your credit score was borderline-good, your lender is likely to bump you down to the risky category and deny your application. 

If you’re lucky, they will want more documentation, e.g. a letter from your employer declaring that your job is safe, or proof of savings for 12 months of mortgage payments. If you’re able to furnish these, very well; otherwise, it will be wiser to stay put until the dust settles.