Things to Avoid While Buying a Home
Many new homebuyers make the mistake of rushing out to buy new things for their home as soon as the seller accepts their offer and the lender approves the loan. There are still a few major hurdles to jump before your loan closes. Here are some things to avoid during the home buying process to be sure the transaction goes smoothly.
Don't overspend on big-ticket items Although you will be planning ways to turn your new home into a castle, avoid big ticket purchases like appliances, electronics, or expensive furnishings. We also recommend that you keep 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 credit cards. Because lenders are perusing your bank accounts, a large cash purchase is also a mistake.
Don't get a new career. Consistency in your job history is a good thing to banks and other lenders. Changing jobs may not compromise your ability to qualify for a mortgage loan - particularly if you are going to be making more money. However, switching careers during your loan process could affect whether or not you are approved.
Don't take your accounts to a new bank or move around your cash. Bank statements from recent months for accounts in your name (savings, checking, money market, and other assets) will likely be studied as the lender makes decisions regarding your mortgage application. The lending institution needs to see a steady rise and fall of your funds each month, in order to rule out fraud. No matter the purpose, switching banks or transferring funds can raise a red flag with your lender and slow down your qualification process.
Don't give your FSBO (for sale by owner) seller earnest money, made out directly to him. Your good faith deposit does not belong to the seller: it is actually yours until the sale closes. Although your seller may not realize this, any good faith money must be applied to your closing expenses. We recommend that you put the funds into a trust account, or get a neutral party, like a lawyer to hold them until the closing of the sale. The contract should document to whom the money goes if the home purchase falls through.
Bright Vision Mortgage can answer questions about these "Don'ts" and many others. Call us: (904) 342-3622.