Don't Trip Yourself up While Buying your Home
Many new homebuyers make the mistake of rushing out to buy things to fill their home as soon as the seller accepts their offer and the lender approves the loan. There are still a few major hurdles to jump before the keys are handed over. Below you'll find a list of actions to stay away from during this critical time of your home purchase.
Don't empty your wallet on big-ticket items Although you may be dreaming of ways to turn your new house into a castle, try to stay away from big ticket purchases like appliances, electronics, or expensive furnishings. You will also want to avoid vacations and vehicle purchases until your loan closes. Your credit numbers could be altered suddenly if you make a huge purchase using plastic. Because lending institutions are reviewing your bank accounts, a large cash purchase is also not advised.
Don't look for a new career. Lenders feel comfortable seeing a consistent job history on your application forms. Getting a new job may not affect your ability to qualify for a loan - especially if you are going to be making more money. But for some people, getting a new job during the loan approval process may raise concern and stymie your application.
Don't take your accounts to a new bank or move around your finances. Bank statements from the last two or three months for accounts in your name (checking, savings, money market, and other assets) will probably be studied as the lending institution considers your approval. In order to avoid fraud, lenders look for clear documentation of how you earn your living and where additional wealth comes from. Even for innocent purposes, moving around funds or changing banks may make it harder for the lending institution to confirm your bank history.
Don't deliver earnest money directly to the seller in a FSBO (for sale by owner) purchase. Your good faith deposit does not belong to the seller: it is actually yours until the transaction is final. Your earnest funds are to be applied to your expenses closing; some individual sellers may not understand this. It's advisable to put the funds into a trust account, or get an attorney to hold them until the closing of the sale. The purchase agreement should dictate where the deposit goes if the home purchase falls through.
Carter Financial Solutions can answer questions about these "Don'ts" and many others. Give us a call: 866-840-8745 x2.