Things to Avoid While Buying a Home
Some new homebuyers make the mistake of rushing out to buy new things for their home soon after the seller says "yes" and the lender approves the loan. Until your loan closes, there are still some hoops to jump through. Here are some things to refrain from during the home buying process to assure your transaction goes smoothly.
Don't make expensive purchases. 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, jewelry, appliances, or vacations until closing. Your lender may send up red flags if you buy your appliances on your credit cards during your loan process. It's even a mistake to make those big-ticket purchases using cash. Lending Institutions are examining your cash on hand when considering your loan.
Don't get a new career. Stability in your work history is a positive thing to lenders. 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, getting a new job in the middle of the application process could influence whether or not you are approved.
Don't switch banks or move cash around in your bank accounts. As your lender considers your mortgage loan package, you will likely be instructed to submit bank statements for the last few months for your checking accounts, savings accounts, money market funds and other liquid finances. The lender wants to see a steady flow of your funds over the pay period, in order to rule out fraud. Even for innocent purposes, moving around money or changing banks might make it more difficult for the lender to verify your bank history.
Don't give your FSBO (for sale by owner) seller a "good faith" deposit, delivered to his door. Your good faith money does not belong to the seller: it remains yours until closing. Although your FSBO seller may not realize this, any earnest money must be applied to your closing expenses. Get an attorney or other neutral party who is able to hold the funds or put them in a trust account until closing. If your sale falls through, the purchase agreement should document to whom the good faith funds should go.
Price Mortgage Group LLC can walk you through the pitfalls of getting a mortgage. Call us: 405-513-7700.