Things to Avoid While Purchasing a New Home
What's more fun than getting a bunch of new furniture to adorn your future home? Nothing. But buying big ticket items before closing can be a misstep. Until your keys are in hand, there are still some hurdles to jump. We have given you a list of things below we suggest you avoid when waiting for your loan to close.
Don't buy big-ticket items. You may be itching to order that new sofa for the soon-to-be-yours den, but it's advisable to stay away from making large buys like furniture, appliances, jewelry, or cars until your home loan closes. Your credit numbers could change suddenly if you make a huge purchase using credit cards. Using cash to buy expensive items can also create a mistake: many lenders consider your available cash when approving your loan.
Don't go on a career search. Consistency in your job history is a good thing to lending institutions. Finding a new career (particularly one with a bigger salary) may not jeopardize your ability to qualify for your loan. However, finding a new job during your approval process could influence whether or not you are approved.
Don't switch your accounts to a new bank or move around your finances. Most lenders will require you to provide recent bank statements for your accounts: savings, checking, money market, and other liquid assets. The lending institution will need to see a steady flow of your funds over the month, in the interest of avoiding fraud. Switching banks or transferring money to another account - even if its only to pool funds - might make it harder for the lender to document your funds.
Don't give funds directly to your seller (generally in the case of of "for sale by owner") for a "good faith" deposit. Until the completion of the deal, any good faith money remains yours. Although your seller might not know this, your good faith money should go toward the buyer's closing expenses. We recommend that you put the deposit into a trust account, or get a neutral party, like a lawyer, to hold it until the deal closes. The final disposition of earnest money, in the case of a failed transaction, should be specified in the contract with the seller.
REDDISH BULL FINANCE, INC. | NMLS #1247892 can walk you through the pitfalls of getting a mortgage. Call us at 561-475-2281.