Don't Trip Yourself up While Buying your New Home
With the thrill that comes with an accepted offer and a "yes" from the lender, many homebuyers make the error of carrying their enthusiasm straight to the mall or furniture store. There still remain a few major hurdles to jump before the house is realy yours. Below you'll find a list of things to stay away from during this crucial time of your home purchase.
Don't buy luxury items. Although you will be dreaming of ways to turn your new house into a castle, try to stay away from big ticket purchases like appliances, electronics, or furniture. We also recommend that you avoid vacations and car purchases until your loan closes. Your credit numbers could change suddenly if you make a huge purchase using plastic. It's even a red flag to make those large purchases with cash. Lenders are examining your cash on hand when considering your loan.
Don't look for a new career. Your recent job history should show consistency. Finding a new job (particularly one with a bump in salary) may not change your ability to qualify for your loan. However, getting a new career during the application process may influence whether or not you are approved.
Don't move finances around or change banks. Your lender will ask for recent bank statements for all of your accounts: checking, savings, money market, and other liquid assets. Your lender is looking for a consistent flow of your funds each month, in the interest of avoiding fraud. Changing banks or moving finances elsewhere - for whatever reason - may hinder the review of your accounts.
Don't hand over earnest money directly to the seller in a FSBO (for sale by owner) purchase. As a rule, your good faith money belongs to you, not the seller up until the sale is final. Some sellers may not know that any good faith funds is to go toward your expenses at closing. A neutral party, like an attorney can hang onto your deposit, or you may put it temporarily into a trust account until you close. The contract should specify to whom the deposit goes if the home purchase fails.
At Amity Mortgage LLC, we answer questions about this process every day. Give us a call: (203) 729-6681.