Things to Avoid While Purchasing a Home

In the rush of excitement that comes with an accepted offer and a "yes" from the lender, many homebuyers make the mistake of taking their enthusiasm straight to the mall or appliance store. It's best to remember that until you get the keys, your lender is watching you very closely. Below you'll find a list of actions to avoid during this crucial time of your home purchase.

Don't buy luxury items. You may be itching to order that new easy-chair for the soon-to-be-yours parlor, but it's advisable to stay away from making large buys like furniture, appliances, jewelry, or cars until closing. Financing your furniture with a store card or a bank credit card could put your credit worthiness at risk when you need it the most. Since lenders are reviewing your bank accounts, a large cash purchase is also a mistake.

Don't go on a career search. Lenders feel comfortable seeing a consistent career history on your application forms. Getting a new job before you start the application process for a mortgage may not jeopardize your approval at all. However, switching careers in the middle of your approval process could influence your approval.

Don't move finances around or change banks. Bank statements from the last two or three months for accounts in your name (savings, checking, money market, and other assets) will likely be reviewed as the lender makes decisions regarding your application. Your lender looks for a consistent flow of your money each month, in the interest of ruling out fraud. Even for practical purposes, transferring cash or changing banks may make it difficult for the lending institution to confirm your account history.

Don't give your FSBO (for sale by owner) seller earnest money, made out directly to him. As a rule, your good faith deposit is yours, not the seller's up until the sale is final. Your earnest funds are to go toward your expenses upon closing; some sellers may not know this. Find an attorney or other neutral person who will hold the funds or place them in a trust account until you close. Should your home purchase fail, your contract with the seller should indicate where your good faith deposit should go.

At Integrated Financial Solutions, LLC, we answer questions about this process every day. Give us a call: 4104614043.