What to Avoid During your Home Purchase
In the rush of excitement that comes with an accepted offer and a "yes" from the lender, some homebuyers make the error of taking their enthusiasm straight to the mall or appliance store. There are still a few major hurdles to jump before the house is realy yours. We have listed some actions below we suggest you avoid when waiting for your loan to close.
Don't make expensive purchases. Although you will be listing ways to turn your new house into a castle, try to stay away from big ticket purchases like appliances, electronics, or expensive furnishings. We also recommend that you stay away from vacations and car purchases until the closing of your loan. Using plastic to buy furniture could jeopardize your loan process by altering your numbers dramatically. Because lending institutions are reviewing 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. Changing jobs may not affect your ability to qualify for a loan - especially if you are going to be making more money. But in some cases, changing careers during the mortgage loan approval process could bring concern and hinder your approval.
Don't move money around or change banks. Your lender will instruct the submission of recent bank statements of accounts in your name: savings, checking, money market, and other liquid assets. Your lender is looking for a consistent flow of your money each month, in order to rule out fraud. No matter the reason, changing banks or transferring funds might raise a red flag with your lender and impede your application process.
Don't deliver earnest money directly to the seller in a FSBO (for sale by owner) purchase. Your good faith deposit does not belong to the seller: it is actually yours until the transaction is final. Any earnest funds are to be used for your expenses upon closing; a FSBO seller might not realize this. A neutral party, like an attorney can hang onto your deposit, or you may put it temporarily into a trust account until closing. The final disposition of good faith money, in the case of a failed transaction, should be written in the contract with the seller.
New Millennium Mortgage Co. NMLS: 331173 can walk you through the pitfalls of getting a mortgage. Call us at (941) 366-5800.
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