Don't Trip Yourself up While Buying your New Home

What's better than getting a bunch of new stuff to go in your future home? Nothing. But buying big ticket items before closing can be a mistake. Until your keys are in hand, there still remain some hurdles to jump. Here are some actions to refrain from before closing to assure your transaction goes smoothly.

Don't throw your money around. You may be itching to turn your new kitchen into a home magazine cover, or celebrate your new castle, but keep away from expensive purchases like furniture, jewelry, appliances, or vacations until closing. Financing new Plasma TVs with a store card or a bank credit card could jeopardize your credit worthiness when you need it the most. Using cash to buy big items can also be a mistake: most lenders consider your cash reserve when approving your loan.

Don't go on a job search. Lenders look for a consistent job history on your application. Changing jobs may not compromise your ability to qualify for a mortgage loan - especially if you are getting a bigger paycheck. However, getting a new job during the application process could influence your approval.

Don't move finances around or change banks. Most lenders will instruct the submission of recent bank statements on your accounts: savings, checking, money market, and other assets. The lender is looking for a steady rise and fall of your money over the month, in the interest of ruling out fraud. Changing banks or moving funds elsewhere - no matter the reason - could make it difficult for your lender to document your funds.

Don't give your FSBO (for sale by owner) seller earnest money, made out directly to him. Until the completion of the deal, the earnest money actually belongs to you. Some FSBO sellers may not realize that your good faith funds is to go toward your expenses at closing. A neutral party, like an attorney can hang onto your funds, or you may place them temporarily into a trust account until closing. Should your home purchase fail, the purchase agreement should indicate to whom the earnest money should go.

At Sky Apply Mortgage, we answer questions about this process every day. Call us at (813) 200-7931.

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