Don't Trip Yourself up While Buying your New Home
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What's better than getting a bunch of new furnishings to go in your future home? Not much. But buying big ticket items before closing could be trouble. There still remain a few major hurdles to jump before closing. Below you'll find a list of actions to stay away from during this crucial time of your home purchase.
Don't overspend on big-ticket items Although you may be dreaming of ways to turn your new home into a castle, avoid major purchases like appliances, electronics, or expensive furnishings. You will also want to stay away from vacations and car purchases until the closing of your loan. Financing new Plasma TVs with a store card or a bank credit card could put your credit worthiness at risk when you need it the most. Because lenders are looking closely at your bank accounts, a large cash purchase is also a mistake.
Don't get a new job. Lenders like to see a consistent career history on your paperwork. Getting a new job before you start the application process for a mortgage may not get in the way of your approval at all. However, if you switch careers before your loan is approved, your mortgage process could fail or be stalled.
Don't take your accounts to a new bank or move around your finances. Bank statements from recent months for accounts in your name (checking, savings, money market, and other assets) will be analyzed as the lending institution makes decisions regarding your loan application. The lender is looking for a consistent flow of your funds over the month, in the interest of avoiding fraud. No matter the purpose, moving banks or transferring funds could raise a red flag with the lender and slow your approval process.
Don't give your FSBO (for sale by owner) seller a "good faith" deposit, delivered to his door. Until closing, the good faith money actually belongs to you. Your good faith money is to be used for your expenses closing; some FSBO sellers might not know this. We recommend that you put the funds into a trust account, or get an attorney to hold them until the deal closes. The contract should document to whom the deposit goes if the home purchase fails.
Full Access Mortgage, Inc. (NMLS 1049472) can answer questions about these "Don'ts" and many others. Give us a call: (402) 502-9037.