Don't Trip Yourself up While Buying your 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. Below you'll find a list of actions to avoid during this crucial time of your home purchase.

Don't buy luxury items. Although you may be listing ways to turn your new house into a showplace, try to stay away from major purchases like appliances, electronics, or furniture. You will also want to avoid vacations and vehicle purchases until your loan closes. You may send up red flags with your lender if you buy new furniture on your credit cards in the middle of your loan process. Because lending institutions are looking closely at your bank accounts, a large cash purchase is also a bad idea.

Don't go on a job search. Your recent job history should show stability. Finding a new career (especially one with a better paycheck) may not hinder your ability to qualify for a mortgage loan. However, if you switch careers before you qualify, your process could fail or be slowed down.

Don't take your accounts to a new bank or move around your money. Bank statements from the last few months for all of your accounts (checking, savings, money market, and other assets) will likely be studied as the lending institution considers your application. In order to detect fraud, lenders need clear documentation of how you earn your money and where additional funds come from. No matter the purpose, moving banks or transferring money may raise a red flag with the lender and impede your application process.

Don't give cash directly to your seller (usually in cases of "for sale by owner") for earnest money. Until closing, any good faith deposit actually belongs to you. Your earnest funds are to go toward your expenses closing; some individual sellers might not understand this. You'll want to put the deposit into a trust account, or get an attorney to hold it until the closing of the sale. The contract should dictate who gets the deposit if the home purchase does not go through.

Price Mortgage Group LLC can answer questions about these "Don'ts" and many others. Call us: 405-513-7700.