Things to Avoid While Purchasing a New Home
Some new homebuyers make the mistake of rushing out to buy new things for their home soon after the seller says "yes" and the lender approves the loan. There still remain a few major hurdles to jump before the keys are handed over. We have listed some actions below we suggest you avoid when waiting for your loan to close.
Don't buy luxury items. You may be itching to buy that new easy-chair for the soon-to-be-yours living room, but it's best to stay away from making major purchases like furniture, appliances, electronic equipment, or cars until closing. Your credit numbers could be altered suddenly if you purchase new furniture using credit cards. Since lending institutions are perusing your bank accounts, a large cash purchase is also not advised.
Don't get a new job. Your recent job history should show consistency. Getting a new career before you start the application process for a loan may not compromise your approval at all. However, switching jobs in the middle of your loan process could influence whether or not you are approved.
Don't switch your accounts to a new bank or move around your cash. Your lender will ask for recent bank statements of your accounts: savings, checking, money market, and other liquid assets. To eliminate fraud, lenders look for a consistent portrayal of how you earn your money and where any additional wealth comes from. Changing banks or transferring finances to another account - no matter the reason - could hinder the review of your accounts.
Don't give your FSBO (for sale by owner) seller earnest money, delivered to his door. Your good faith deposit does not belong to the seller: it remains yours until the transaction is final. Your seller might not know that the good faith funds must go toward your expenses upon closing. Find an attorney or other neutral person who can hold the funds or place them in a trust account until you close. Should your home purchase fail, the purchase agreement should dictate where this earnest money should go.
Amity Mortgage LLC can walk you through the pitfalls of getting a mortgage. Give us a call: (203) 729-6681.