Don't Trip Yourself up While Buying 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 wise to remember that until closing, your lender is watching you very closely. We have listed some things below you will want to stay away from when waiting for your loan to close.
Don't buy big-ticket items. You may be itching to buy that new Turkish rug for the soon-to-be-yours parlor, but it's advisable to avoid making major buys like furniture, appliances, electronic equipment, or vacations until closing. You may send up red flags with your lender if you finance your appliances on your credit cards in the middle of your loan process. It's even a mistake to make those big purchases using cash. Lenders are examining your cash reserve when considering your loan.
Don't get a new job. Your recent job history should show consistency. Getting a new job may not jeopardize your ability to qualify for a loan - particularly if you are getting a better salary. However, if you switch careers before your loan is approved, your mortgage process could fail or be slowed down.
Don't move money around or switch banks. As your lending institution reviews your mortgage package, you will probably be instructed to submit bank statements for recent months for your saving and checking accounts, money market accounts and other liquid finances. Your lending institution looks for a consistent rise and fall of your money over the month, in the interest of avoiding fraud. No matter the purpose, changing banks or transferring money may raise a red flag with your lender and slow down your loan process.
Don't give your FSBO (for sale by owner) seller earnest money, made out directly to him. Until the completion of the deal, any good faith deposit actually belongs to you. Your FSBO seller may not realize that the good faith funds should go toward your expenses at closing. You'll need to put the funds into a trust account, or get an attorney to hold them until closing. The disposition of good faith funds, if your sale falls through, should be specified in the contract with your seller.
At Integrated Financial Solutions, LLC, we answer questions about this process every day. Give us a call at 4104614043.