Don't Trip Yourself up While Buying your Home
Some new homebuyers make the mistake of rushing out to buy things to fill their home soon after the seller says "yes" and the loan is approved. Keep in mind that until you get the keys, your lender is watching you very closely. Below you'll find a list of actions to stay away from during this crucial time of your home purchase.
Don't throw your money around. You may be tempted to order that new easy-chair for the soon-to-be-yours den, but it's best to stay away from making major purchases like furniture, appliances, jewelry, or cars until closing. Your credit numbers could change suddenly if you purchase new furniture using plastic. Because lenders are looking closely at your bank accounts, a large cash purchase is also a bad idea.
Don't look for a new job. Lending Institutions look for a consistent career history on your application. Getting a new career before you start the application process for a loan may not get in the way of your approval at all. However, finding a new career in the middle of the approval process may influence whether or not you are approved.
Don't switch your accounts to a new bank or move around your money. While the lending institution considers your mortgage loan package, you will probably be asked to submit bank statements for the last few months for your checking accounts, savings accounts, money market accounts and other liquid finances. To detect potential fraud, most lending institutions need detailed paperwork to determine the source of all cash. Switching banks or moving finances to another account - for whatever reason - may make it difficult for your lender to document your funds.
Don't give funds directly to your seller (generally in cases of "for sale by owner") to be considered earnest money. As a rule, your good faith deposit is yours, not the seller's up until the sale is final. Although your FSBO seller might not understand this, any good faith money must be used for the buyer's closing expenses. A neutral party, like an attorney can hold onto your funds, or you may place them temporarily into a trust account until you close. The purchase agreement should dictate to whom the funds go if the home purchase falls through.
Pacific Loan Brokers can walk you through the pitfalls of getting a mortgage. Call us: 877-310-6200.
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