Don't Trip Yourself up While Buying 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 taking their enthusiasm straight to the mall or appliance store. Until the house is really yours, there still remain some hurdles to jump. We have given you a list of things below you will want to stay away from when waiting for closing.
Don't empty your wallet on big-ticket items You may be tempted to order that new Turkish rug for the soon-to-be-yours living room, but it's advisable to stay away from making big ticket buys like furniture, appliances, electronic equipment, or cars until closing. Using credit cards to buy new living room furniture could compromise your lending process by altering your numbers dramatically. It's even a red flag to make those huge purchases using cash. Lenders are examining your cash reserve when considering your loan.
Don't get a new career. Your recent work history should show consistency. Getting a new job may not jeopardize your ability to qualify for a mortgage loan - especially if you are getting a better salary. But for some people, changing jobs during the mortgage loan approval process might raise concern and stymie your application.
Don't take your accounts to a new bank or move around your money. Your lender will ask for recent bank statements of all of your accounts: checking, savings, money market, and other liquid assets. In order to eliminate fraud, lenders require clear documentation of how you earn your living and where additional funds come from. Even for practical reasons, transferring cash or changing banks could make it harder for your lending institution to verify your bank history.
Don't give your FSBO (for sale by owner) seller a "good faith" deposit, made out directly to him. As a rule, your good faith deposit belongs to you, not the seller until closing. The good faith money is to be applied to your expenses closing; some sellers might not realize this. Get a lawyer or other neutral party who will hang on to the funds or put them in a trust account until closing. Should your sale fall through, the purchase contract should specify to whom your earnest money should go.
The Mortgage Firm - Team Meyers can answer questions about these "Don'ts" and many others. Call us at (407) 889-4321.