Things to Avoid While Purchasing a Home

Many new homebuyers make the mistake of rushing out to buy new things for their home as soon as the seller accepts their offer and the loan is approved. There are still a few major hurdles to jump before the keys are handed over. Here are some things to stay clear of during the home buying process to assure the transaction goes smoothly.

Don't buy luxury items. Although you may be planning ways to turn your new house into a castle, avoid major purchases like appliances, electronics, or furniture. You will also want to keep away from vacations and car purchases until your loan closes. Financing new furniture with a store card or a bank credit card could jeopardize your credit worthiness during the time it means the most. Using cash to purchase big items can even create a mistake: many banks take into consideration your available cash when approving your application.

Don't get a new career. Lending Institutions like to see a consistent work history on your application. Changing jobs may not compromise your ability to qualify for a loan - particularly if you are going to be making more money. But for some people, changing jobs during the loan approval process could bring concern and affect your application.

Don't change banks or move finances around in your bank accounts. As your lending institution reviews your mortgage application, you will likely be instructed to provide bank statements for the last few months on your saving and checking accounts, money market accounts and other liquid wealth. The lender looks for a consistent rise and fall of your funds over the pay period, in order to avoid fraud. Even for innocent purposes, transferring finances or switching banks could make it more difficult for your lender to document your bank history.

Don't give your FSBO (for sale by owner) seller earnest money, delivered to his door. As a rule, your good faith money is yours, not the seller's until closing. The good faith funds are to be used for your expenses closing; a FSBO seller might not know this. Get an attorney or other neutral person who will hold the funds or put them in a trust account until you close. Should your sale fall through, your contract with the seller should indicate to whom the good faith deposit should go.

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