What to Avoid During your Home Purchase

Some new homebuyers make the mistake of rushing out to buy things to fill their home soon after the seller accepts their offer and the lender approves the loan. There are still a few major hurdles to jump before closing. Here are some actions to avoid during the home buying process to assure the transaction goes well.

Don't empty your wallet on big-ticket items It may be tempting to order that new easy-chair for the soon-to-be-yours living room, but it's advisable to avoid making big ticket purchases like furniture, appliances, electronic equipment, or cars until closing. Using plastic to buy furniture could compromise your loan process by altering your numbers dramatically. Because lending institutions are perusing your bank accounts, a large cash purchase is also not advised.

Don't go on a job search. Your recent job history should show consistency. Changing jobs may not compromise your ability to qualify for a loan - especially if you are getting a bigger paycheck. However, switching careers in the middle of your loan process may influence whether or not you are approved.

Don't take 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 (savings, checking, money market, and others) will be reviewed as the lending institution makes decisions regarding your mortgage application. The lending institution is looking for a consistent rise and fall of your money each month, in the interest of avoiding fraud. No matter the reason, changing banks or transferring money may raise a red flag with your lender and impede your application process.

Don't give your FSBO (for sale by owner) seller earnest money, cash in hand. As a rule, your good faith money is yours, not the seller's until the sale is final. The earnest funds are to be used for your expenses upon closing; some FSBO sellers might not realize this. Find an attorney or other neutral party who can hang on to the money or place it in a trust account until you close. The purchase contract should document to whom the funds go if the home purchase does not go 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.