Don't Trip Yourself up While Buying your Home
Many new homebuyers make the mistake of rushing out to buy things to fill their home as soon as the seller says "yes" and the lender approves the loan. There still remain a few major hurdles to jump before the house is realy yours. We have given you a list of actions below we suggest you stay away from when waiting for your loan to close.
Don't buy luxury items. Although you will be planning ways to turn your new house into a showplace, avoid big ticket purchases like appliances, electronics, or furniture. We also recommend that you stay away from vacations and car purchases until the closing of your loan. Your credit numbers could be altered suddenly if you make a huge purchase using plastic. It's also a red flag to make those big-ticket purchases with cash. Lending Institutions are examining your available cash when considering your loan.
Don't look for a new career. Lenders look for a consistent job history on your application forms. Finding a new job (especially one with a bigger paycheck) may not change your ability to qualify for a mortgage loan. But in some cases, switching jobs during the loan application process could bring concern and stymie your application.
Don't switch banks or move cash around in your accounts. While your lending institution reviews your loan application, you will likely be asked to produce bank statements for the last two or three months on your checking accounts, savings accounts, money market accounts and other liquid wealth. To avoid potential fraud, most lenders require detailed paperwork to verify the source of all incoming funds. Switching banks or transferring funds to another account - no matter the purpose - might hinder the documentation of your accounts.
Don't give a "good faith" deposit directly to the seller in a FSBO (for sale by owner) purchase. As a rule, your good faith deposit belongs to you, not to the seller until closing. Any earnest funds are to be applied to your expenses upon closing; some individual sellers may not understand this. A neutral party, like an attorney can hang onto your funds, or you may put them temporarily into a trust account until closing. Should your sale fall through, your purchase agreement should document where this earnest money should go.
Contemporary Mortgage Services, Inc can answer questions about these "Don'ts" and many others. Give us a call at 407-834-3377.
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