Things to Avoid While Purchasing a Home
With the thrill that comes with an accepted offer and a "yes" from the lender, many homebuyers make the error of taking their enthusiasm straight to the mall or furniture store. It's wise to remember that until your keys are in hand, your lender is watching your accounts very closely. We have given you a list of actions below we suggest you avoid when waiting for your loan to close.
Don't buy big-ticket items. Although you will be planning ways to turn your new home into a showplace, avoid major purchases like appliances, electronics, or expensive furnishings. You will also want to avoid vacations and vehicle purchases until the closing of your loan. Your credit numbers could change suddenly if you make a huge purchase using plastic. Using cash to buy expensive items can also create a bad idea: most lenders look at your available cash when approving your mortgage.
Don't get a new career. Stability in your job history is a good thing to banks and other lenders. Changing jobs may not affect your ability to qualify for a mortgage loan - particularly if you are getting a better salary. However, switching jobs during the loan process may influence your approval.
Don't take your accounts to a new bank or move around your money. Bank statements from the last few months for your accounts (checking, savings, money market, and other assets) will probably be studied as the lender considers your mortgage application. To eliminate fraud, lenders will need clear documentation of how you earn your living and where additional money comes from. Even for practical purposes, transferring funds or changing banks could make it more difficult for your lender to document your account history.
Don't give earnest money directly to the seller in a FSBO (for sale by owner) purchase. Your earnest money does not belong to the seller: it remains yours until the sale closes. Although your seller may not understand this, your earnest money must be applied to your closing expenses. A neutral party, like an attorney can hang onto your deposit, or you may put it temporarily into a trust account until closing. Should your sale fall through, the contract with the seller should specify to whom the good faith deposit should go.
MidTowne Mortgage can answer questions about these "Don'ts" and many others. Call us at 4787462063.