What to Avoid During your Home Purchase
With the thrill that comes with an accepted offer and a "yes" from the lender, some homebuyers make the error of carrying their enthusiasm straight to the mall or appliance store. There are still a few major hurdles to jump before closing. 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 You may be itching to turn your new living room into a showplace, or celebrate your new dream home, but keep away from expensive purchases like furniture, cars, appliances, or vacations until your loan closes. You may send up red flags with your lender if you purchase your furniture on your credit cards in the middle of your loan process. Because lending institutions are looking closely at your financial accounts, a large cash purchase is also a bad idea.
Don't go on a career search. Your recent job history should show stability. Getting a new job may not affect your ability to qualify for a loan - particularly if you are getting a better salary. But in some cases, switching jobs during the mortgage application process could bring concern and stymie your approval.
Don't change banks or move cash around in your accounts. Bank statements from the last few months for your accounts (checking, savings, money market, and other accounts) will be reviewed as the lending institution makes decisions regarding your mortgage application. In order to avoid fraud, lenders will need a consistent portrayal of how you earn your living and where additional funds come from. Even for innocent purposes, moving around money or switching banks might make it difficult for your lending institution to confirm your account history.
Don't give your FSBO (for sale by owner) seller a "good faith" deposit, cash in hand. Your good faith money does not belong to the seller: it is actually yours until the sale closes. Although your seller may not realize this, the earnest money must be used for the buyer's closing expenses. Find a lawyer or other neutral person who is able to hold the deposit or put it in a trust account until you close. The final disposition of good faith money, if your home purchase falls through, should be documented in the contract with your seller.
Wize Mortgage LLC can walk you through the pitfalls of getting a mortgage. Give us a call at .