Things to Avoid While Purchasing a New Home
In the rush of excitement 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 furniture store. Until closing, there still remain some hoops to jump through. Here are some things to avoid before closing to assure your transaction goes smoothly.
Don't empty your wallet on big-ticket items Although you will be listing ways to turn your new house into a castle, try to stay away from major purchases like appliances, electronics, or furniture. We also recommend that you keep away from vacations and vehicle purchases until the closing of your loan. You may send up red flags with your lender if you purchase new furniture on your credit cards during your loan process. Since lenders are examining your financial accounts, a large cash purchase is also a bad idea.
Don't go on a job search. Lending Institutions feel comfortable seeing a consistent job history on your paperwork. Finding a new job (especially one with a better paycheck) may not change your ability to qualify for a loan. However, if you switch careers before you qualify, your mortgage process could fail or be slowed down.
Don't change banks or move money around in your bank accounts. Bank statements from recent months for your accounts (checking, savings, money market, and other assets) will probably be analyzed as the lender makes decisions regarding your loan application. To detect fraud, lenders will need clear documentation of how you earn your living and where additional money comes from. No matter the purpose, moving banks or transferring funds could raise a red flag with your lender and impede your approval process.
Don't give your FSBO (for sale by owner) seller earnest money, cash in hand. As a rule, your earnest money is yours, not the seller's up until the sale is final. Some sellers might not realize that any good faith money must go toward your expenses upon closing. Find an attorney or other neutral party who can hold the money or put it in a trust account until you close. The final disposition of earnest funds, if your transaction falls through, should be specified in the contract with your seller.
Price Mortgage Group LLC can walk you through the pitfalls of getting a mortgage. Call us at 405-513-7700.