Things to Avoid While Buying a Home

With the thrill that comes with an accepted offer and a "yes" from the lender, many homebuyers make the error of taking their enthusiasm straight to the mall or appliance store. There still remain a few major hurdles to jump before the keys are handed over. We have listed some things below you will want to avoid when waiting for your loan to close.

Don't buy big-ticket items. Although you will be planning ways to turn your new house into a castle, try to stay away from big ticket purchases like appliances, electronics, or furniture. You will also want to keep away from vacations and vehicle purchases until your loan closes. Your lender may send up red flags if you finance your furniture on your credit cards during your loan process. It's also a red flag to make those big-ticket purchases using cash. Lending Institutions are looking at your available cash when considering your loan.

Don't get a new career. Consistency in your job history is a good thing to lenders. Getting a new job may not compromise your ability to qualify for a mortgage loan - especially if you are improving your salary. But for some people, changing careers during the mortgage loan application process might bring concern and hinder your approval.

Don't move cash around or switch banks. Your lender will instruct the submission of recent bank statements on accounts in your name: savings, checking, money market, and other liquid assets. To avoid fraud, lenders want to see a consistent portrayal of how you earn your living and where additional money comes from. Even for innocent reasons, transferring money or changing banks could make it more difficult for your lending institution to verify your bank history.

Don't deliver a "good faith" deposit directly to the seller in a FSBO (for sale by owner) purchase. Your earnest money does not belong to the seller: it remains yours until the transaction is final. Although your FSBO seller might not realize this, any good faith funds should be applied to the buyer's closing expenses. A neutral party, like an attorney can hold your funds, or you may put them temporarily into a trust account until closing. The final disposition of good faith money, if your sale fails, should be specified in the contract with your seller.

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