Don't Trip Yourself up While Buying a Home

Many new homebuyers make the mistake of rushing out to buy new things for their home soon after the seller accepts their offer and the loan is approved. Until closing, there are still some hurdles to jump. We have given you a list of actions below we suggest you stay away from when waiting for closing.

Don't make expensive purchases. 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. Using credit cards to buy new living room furniture could compromise your lending process by changing your numbers dramatically. Since lending institutions are perusing your bank accounts, a large cash purchase is also not advised.

Don't go on a career search. Your recent work history should show stability. Getting a new job may not compromise your ability to qualify for a loan - especially if you are getting a better salary. However, if you switch careers before approval, your mortgage process could fail or be bogged down.

Don't take your accounts to a new bank or move around your finances. As your lender considers your loan package, you will probably be instructed to submit bank statements for the last two or three months for your saving and checking accounts, money market funds and other liquid wealth. To eliminate fraud, lenders require a consistent portrayal of how you earn your money and where additional money comes from. No matter the purpose, changing banks or transferring funds may raise a red flag with your lender and impede your application process.

Don't give your FSBO (for sale by owner) seller earnest money, made out directly to him. Until closing, any earnest money actually belongs to you. Your seller may not realize that the good faith funds must go toward your expenses upon closing. A neutral party, like an attorney can hold onto your earnest money, or you may put it temporarily into a trust account until you close. The purchase contract should indicate who keeps the money if the home purchase falls through.

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