Things to Avoid While Buying a New Home

With the thrill that comes with an accepted offer and a "yes" from the lender, some homebuyers make the mistake of carrying their enthusiasm straight to the mall or appliance store. There are still a few major hurdles to jump before closing. Below you'll find a list of things to avoid during this critical time of your home purchase.

Don't empty your wallet on big-ticket items You may be itching to turn your new living room into a showplace, or celebrate your new dream home, but keep away from major purchases like furniture, cars, appliances, or vacations until your loan closes. Your credit numbers could change suddenly if you purchase new furniture using plastic. Because lending institutions are perusing your bank accounts, a large cash purchase is also not advised.

Don't look for a new job. Consistency in your career history is a positive thing to banks and other lenders. Getting a new job may not jeopardize your ability to qualify for a mortgage loan - especially if you are getting a bigger paycheck. But in some cases, changing careers during the loan application process might bring concern and hinder your approval.

Don't switch your accounts to a new bank or move around your cash. Bank statements from recent months for your accounts (checking, savings, money market, and other accounts) will likely be reviewed as the lender makes decisions regarding your loan application. To detect fraud, lenders require clear documentation of how you earn your living and where additional wealth comes from. Changing banks or moving funds elsewhere - no matter the reason - might hinder the documentation of your funds.

Don't give money directly to your seller (generally in the case of of "for sale by owner") to be used as earnest money. Until the sale is complete, the good faith deposit actually belongs to you. Your earnest money is to go toward your expenses closing; some FSBO sellers may not understand this. An attorney or other type of neutral party can hang onto your deposit, or you may put it temporarily into a trust account until closing. The purchase contract should specify who gets the deposit if the transaction falls through.

Not Your Average Lender can walk you through the pitfalls of getting a mortgage. Give us a call at 9722039033.