Don't Trip Yourself up While Buying your New Home
Many new homebuyers make the mistake of rushing out to buy things to fill their home soon after the seller accepts their offer and the loan is approved. Until your loan closes, there still remain some hoops to jump through. We have listed some actions below we suggest you stay away from when waiting for your loan to close.
Don't empty your wallet on big-ticket items Although you may be planning ways to turn your new house into a showplace, avoid big ticket purchases like appliances, electronics, or furniture. You will also want to keep away from vacations and car purchases until the closing of your loan. Your lender may send up red flags if you purchase new appliances on your credit cards during your loan process. Using cash to purchase expensive items can even create a mistake: many lending institutions look at your available cash when approving your application.
Don't go on a job search. Lending Institutions like to see a consistent work history on your application forms. Finding a new job (particularly one with a better paycheck) may not jeopardize your ability to qualify for your loan. However, if you switch careers before approval, your mortgage process could fail or be bogged down.
Don't switch your accounts to a new bank or move around your money. Bank statements from the last two or three months for accounts in your name (checking, savings, money market, and other accounts) will probably be reviewed as the lender considers your approval. The lending institution is looking for a steady rise and fall of your money each month, in order to avoid fraud. No matter the reason, changing banks or transferring money can raise a red flag with the lender and slow down your approval process.
Don't hand over earnest money directly to the seller in a FSBO (for sale by owner) purchase. As a rule, your earnest money is yours, not the seller's until the deal closes. The good faith funds are to go toward your expenses upon closing; some individual sellers may not know this. An attorney or other type of neutral party can hold your deposit, or you may put it temporarily into a trust account until closing. The contract should indicate where the money goes if the home purchase falls through.
REDDISH BULL FINANCE, INC. | NMLS #1247892 can walk you through the pitfalls of getting a mortgage. Give us a call at 561-475-2281.