Don't Trip Yourself up While Buying your Home
Many new homebuyers make the mistake of rushing out to buy new things for their home as soon as the seller says "yes" and the lender approves their loan. It's best to remember that until closing, your lender is watching your finances very closely. Below you'll find a list of things to avoid during this crucial time of your home purchase.
Don't buy big-ticket items. Although you will be listing ways to turn your new home into a showplace, avoid major purchases like appliances, electronics, or furniture. We also recommend that you stay away from vacations and car purchases until the closing of your loan. You may send up red flags with your lender if you purchase new furniture on your credit cards during your loan process. 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 go on a career search. Lending Institutions look for a consistent career history on your application forms. Finding a new job (particularly one with a bigger salary) may not affect your ability to qualify for a mortgage loan. However, if you switch careers before approval, your mortgage process could fail or be slowed down.
Don't move finances around or switch banks. Bank statements from recent months for accounts in your name (checking, savings, money market, and other assets) will probably be studied as the lending institution makes decisions regarding your loan application. In order to detect fraud, lenders look for a clear and consistent picture of how you earn your money and where any additional wealth comes from. No matter the reason, moving banks or transferring money might raise a red flag with your lender and slow your approval process.
Don't hand over earnest money directly to the seller in a FSBO (for sale by owner) purchase. Until the completion of the deal, the earnest money remains yours. Any earnest funds are to be applied to your expenses closing; some individual sellers might not understand this. Find an attorney or other neutral party who can hang on to the money or place it in a trust account until closing. The purchase agreement should document to whom the funds go if the home purchase does not go through.
Sky Apply Mortgage, Inc can answer questions about these "Don'ts" and many others. Call us: (813) 200-7931.
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