Don't Trip Yourself up While Buying your Home
With the thrill that comes with an accepted offer and a "yes" from the lender, some homebuyers make the error of taking their enthusiasm straight to the mall or appliance store. Until your loan closes, there still remain some hurdles to jump. Here are some actions to refrain from before closing to be sure your transaction goes well.
Don't buy big-ticket items. Although you may be planning ways to turn your new house into a showplace, avoid major purchases like appliances, electronics, or furniture. We also recommend that you avoid vacations and vehicle purchases until your loan closes. Your lender may send up red flags if you buy your electronics on your credit cards during your loan process. Using cash to purchase big items can even be a bad idea: most lending institutions take into consideration your available cash when approving your loan.
Don't look for a new career. Lenders like to see a consistent work history on your application. Changing jobs may not jeopardize your ability to qualify for a mortgage loan - particularly if you are getting a bigger paycheck. However, switching careers during the approval process might influence whether or not you are approved.
Don't move money around or change banks. Bank statements from the last few months for all of your accounts (savings, checking, money market, and others) will be reviewed as the lending institution makes decisions regarding your application. In order to avoid fraud, lenders need clear documentation of how you earn your money and where additional funds come from. Even for innocent purposes, moving around finances or changing banks could make it harder for your lending institution to verify your bank history.
Don't give earnest money directly to the seller in a FSBO (for sale by owner) purchase. Until the completion of the deal, any earnest money actually belongs to you. Some FSBO sellers may not know that the earnest money is to go toward your expenses upon closing. A neutral party, like an attorney can hang onto your funds, or you may place them temporarily into a trust account until closing. If your home purchase fails, the purchase contract should indicate to whom this good faith deposit should go.
At REDDISH BULL FINANCE, INC. | NMLS #1247892, we answer questions about this process every day. Call us at 561-475-2281.