Things to Avoid While Purchasing a Home
In the rush of excitement that comes with an accepted offer and a "yes" from the lender, many homebuyers make the mistake of taking their enthusiasm straight to the mall or appliance store. Keep in mind that until you get the keys, your lender is watching your accounts very closely. We have listed some things below we suggest you avoid when waiting for closing.
Don't buy big-ticket items. You may be itching to turn your new kitchen into a home magazine cover, or celebrate your new dream home, but stay away from expensive purchases like furniture, jewelry, appliances, or vacations until closing. Your credit numbers could be altered suddenly if you purchase new furniture using plastic. It's even a red flag to make those big-ticket purchases with cash. Lending Institutions are examining your cash on hand when considering your loan.
Don't look for a new job. Lending Institutions feel comfortable seeing a consistent job history on your application forms. Finding a new job (especially one with a bump in salary) may not affect your ability to qualify for your mortgage. But in some cases, getting a new job during the mortgage approval process might bring concern and hinder your approval.
Don't switch your accounts to a new bank or move around your finances. Most lenders will require you to produce recent bank statements on accounts in your name: checking, savings, money market, and other liquid assets. In order to avoid fraud, lenders will need clear documentation of how you earn your money and where any additional funds come from. Changing banks or transferring finances to another account - even if its merely to consolidate funds - might make it difficult for your lender to verify your funds.
Don't give your FSBO (for sale by owner) seller earnest money, made out directly to him. Until closing, any good faith deposit remains yours. Your earnest funds are to go toward your expenses upon closing; some sellers might not understand this. Find a lawyer or other neutral party who is able to hang on to the funds or put them in a trust account until closing. If your sale falls through, your contract with the seller should document to whom the earnest money should go.
Price Mortgage Group LLC can walk you through the pitfalls of getting a mortgage. Give us a call at 405-513-7700.