Don't Trip Yourself up While Buying a New Home
What's more fun than buying a bunch of new stuff to go in your future home? Nothing. But buying big ticket items before closing can be an error. There still remain a few major hurdles to jump before the house is realy yours. Below you'll find a list of things to stay away from during this critical time of your home purchase.
Don't make expensive purchases. You may be tempted to buy that new couch for the soon-to-be-yours den, but it's best to avoid making big ticket buys like furniture, appliances, electronic equipment, or vacations until your home loan closes. Your credit numbers could change suddenly if you make a huge purchase using credit cards. It's even a mistake to make those big-ticket purchases with cash. Lending Institutions are examining your cash on hand when considering your loan.
Don't look for a new career. Consistency in your work history is a good thing to lending institutions. Changing jobs may not affect your ability to qualify for a loan - especially if you are getting a bigger paycheck. However, getting a new job in the middle of the loan process could affect whether or not you are approved.
Don't change banks or move money around in your accounts. Bank statements from recent months for your accounts (savings, checking, money market, and others) will be reviewed as the lending institution considers your mortgage application. To eliminate potential fraud, most lending institutions need a thorough paper trail to document the source of all cash. Switching banks or transferring funds elsewhere - for whatever purpose - could make it harder for the lender to verify your funds.
Don't give funds directly to your seller (usually in cases of "for sale by owner") for a "good faith" deposit. As a rule, your good faith deposit is yours, not the seller's until closing. A FSBO seller may not know that any good faith money must go toward your expenses upon closing. Get a lawyer or other neutral party who can hold the funds or put them in a trust account until you close. Should your home purchase fail, the purchase contract should indicate to whom the earnest money should go.
Stepping Stone Mortgage can answer questions about these "Don'ts" and many others. Give us a call at 5416833300.