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, some homebuyers make the error of carrying their enthusiasm straight to the mall or appliance store. Until closing, there are still some hoops to jump through. Here are some actions to avoid during the home buying process to assure your transaction goes smoothly.
Don't overspend on big-ticket items Although you will be planning ways to turn your new home into a castle, avoid major purchases like appliances, electronics, or furniture. We also recommend that you avoid vacations and car purchases until the closing of your loan. Your credit numbers could be altered suddenly if you purchase new furniture using plastic. Since lenders are reviewing your financial accounts, a large cash purchase is also a mistake.
Don't get a new career. Consistency in your career history is a good thing to lending institutions. Getting a new job before you start the application process for a mortgage loan may not compromise your approval at all. However, if you switch careers before approval, your loan process could fail or be stalled.
Don't switch your accounts to a new bank or move around your money. As your lender considers your mortgage package, you will probably be asked to provide bank statements for recent months for your saving and checking accounts, money market funds and other liquid finances. To detect potential fraud, most lending institutions require a thorough paper trail to document the source of all incoming funds. Even for practical purposes, transferring cash or changing banks may make it harder for the lending institution to document your account history.
Don't give funds directly to your seller (usually in cases of "for sale by owner") for earnest money. Your good faith deposit does not belong to the seller: it remains yours until the transaction is final. Any good faith funds are to be applied to your expenses closing; some sellers may not understand this. Get an attorney or other neutral party who is able to hold the deposit or place it in a trust account until you close. The final disposition of earnest funds, if your sale fails, should be included in the purchase agreement with your seller.
At Sky Apply Mortgage, Inc, we answer questions about this process every day. Give us a call at (813) 200-7931.
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