Things to Avoid While Buying a New Home

Some 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 loan is approved. Until your keys are in hand, there are still some hoops to jump through. We have given you a list of things below we suggest you stay away from when waiting for your loan to close.

Don't empty your wallet on big-ticket items You may be tempted to order that new sofa for the soon-to-be-yours parlor, but it's advisable to stay away from making major purchases like furniture, appliances, electronic equipment, or cars until closing. Financing new furniture with a store card or a bank credit card could jeopardize your credit worthiness during the time it means 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 go on a job search. Consistency in your career history is a good thing to lending institutions. Finding a new career (especially one with a bigger salary) may not change your ability to qualify for your loan. However, switching jobs during the application process might affect whether or not you are approved.

Don't change banks or move cash around in your bank accounts. Bank statements from the last two or three months for accounts in your name (savings, checking, money market, and others) will be studied as the lending institution considers your application. To avoid potential fraud, most lending institutions want a thorough paper trail to document the source of all incoming funds. No matter the reason, switching banks or moving funds from one account to another could raise a red flag with the lender and impede your application process.

Don't give a "good faith" deposit directly to the seller in a FSBO (for sale by owner) purchase. Your good faith deposit does not belong to the seller: it remains yours until closing. Although your FSBO seller might not know this, the good faith money must be applied to the buyer's closing expenses. Get an attorney or other neutral party who can hold the money or place it in a trust account until you close. The purchase contract should document where the funds go if the home purchase does not go through.

Wize Mortgage LLC can walk you through the pitfalls of getting a mortgage. Give us a call: .