What to Avoid During a Home Purchase
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. It's best to remember that until closing, your lender is watching your finances very closely. We have given you a list of things below you will want to avoid when waiting for closing.
Don't empty your wallet on big-ticket items Although you may be planning ways to turn your new house into a showplace, avoid big ticket purchases like appliances, electronics, or furniture. You will also want to stay away from vacations and car purchases until the closing of your loan. Your credit numbers could be altered suddenly if you make a huge purchase using credit cards. It's even a red flag to make those large purchases with cash. Lending Institutions are looking at your cash reserve when considering your loan.
Don't go on a career search. Your recent work history should show consistency. Getting a new job before you apply for a mortgage loan may not jeopardize your approval at all. But for some, getting a new job during the loan application process may raise concern and hinder your application.
Don't move cash around or change banks. Your lender will instruct the submission of recent bank statements on all of your accounts: checking, savings, money market, and other assets. Your lender wants to see a steady rise and fall of your money each month, in order to rule out fraud. Even for practical reasons, moving around finances or switching banks may make it more difficult for your lending institution to confirm your bank history.
Don't hand over earnest money directly to the seller in a FSBO (for sale by owner) purchase. Your good faith money does not belong to the seller: it remains yours until closing. The earnest money is to go toward your expenses closing; some sellers may not realize this. Get a lawyer or other neutral party who will hang on to the deposit or put it in a trust account until you close. The purchase agreement should specify where the funds go if the home purchase fails.
At Sky Apply Mortgage, we answer questions about this process every day. Give us a call: (813) 200-7931.
Got a Question?
Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.