Don't Trip Yourself up While Buying your Home
Many new homebuyers make the mistake of rushing out to buy new things for their home soon after the seller says "yes" and the loan is approved. Keep in mind that until your keys are in hand, your lender is watching you very closely. We have given you a list of actions below you will want to stay away from when waiting for closing.
Don't make expensive purchases. It may be tempting to order that new sofa for the soon-to-be-yours living room, but it's best to avoid making big ticket purchases like furniture, appliances, jewelry, or vacations until closing. Financing new bedroom furniture with a store card or a bank credit card could jeopardize your credit worthiness when you need it the most. It's even a bad idea to make those large purchases using cash. Lenders are examining your cash on hand when considering your loan.
Don't get a new career. Consistency in your job history is a positive thing to banks and other lenders. Finding a new job (particularly one with a bigger paycheck) may not hinder your ability to qualify for your loan. But for some people, changing jobs during the mortgage loan approval process may raise concern and stymie your application.
Don't take your accounts to a new bank or move around your cash. Your lending institution will instruct the submission of recent bank statements of accounts in your name: checking, savings, money market, and other liquid assets. The lending institution is looking for a steady flow of your money over the pay period, in the interest of ruling out fraud. No matter the reason, moving banks or transferring funds can raise a red flag with the lender and slow down your application process.
Don't give your FSBO (for sale by owner) seller earnest money, cash in hand. As a rule, your good faith deposit belongs to you, not the seller until closing. Your seller might not know that your good faith funds must be applied to your expenses upon closing. Find a lawyer or other neutral party who will hold the deposit or place it in a trust account until closing. The disposition of good faith money, if your sale fails, should be documented in the contract with the seller.
Carter Financial Solutions can walk you through the pitfalls of getting a mortgage. Give us a call: 866-840-8745 x2.