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. Until your keys are in hand, there still remain some hurdles to jump. Below you'll find a list of things to avoid during this critical time of your home purchase.

Don't make expensive purchases. It may be tempting to order that new sofa for the soon-to-be-yours parlor, but it's best to stay away from making major buys like furniture, appliances, jewelry, or cars until your home loan closes. Financing new stainless steel appliances with a store card or a bank credit card could put your credit worthiness at risk during the time it means the most. Because lending institutions are looking closely at your bank accounts, a large cash purchase is also not advised.

Don't get a new job. Lending Institutions look for a consistent job history on your application. Changing jobs may not jeopardize your ability to qualify for a loan - especially if you are improving your salary. But for some people, changing careers during the mortgage application process may bring concern and affect your application.

Don't take your accounts to a new bank or move around your finances. Most lenders will instruct the submission of recent bank statements on your accounts: checking, savings, money market, and other liquid assets. The lender wants to see a steady rise and fall of your money over the pay period, in the interest of ruling out fraud. Even for innocent reasons, moving around finances or switching banks may make it harder for the lender to document your bank history.

Don't give your FSBO (for sale by owner) seller earnest money, cash in hand. As a rule, your good faith money belongs to you, not the seller up until the deal closes. Any good faith funds are to be used for your expenses closing; a FSBO seller may not realize this. Find an attorney or other neutral person who will hold the funds or place them in a trust account until closing. The final disposition of good faith money, in the case of a failed transaction, should be indicated in the purchase agreement with the seller.

My Mortgage Option can walk you through the pitfalls of getting a mortgage. Give us a call at 4693224391.

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