Things to Avoid While Buying a New Home
What's better than buying a bunch of new stuff to go in your future home? Not much. But making big ticket purchases before your loan closes can be a misstep. There are still a few major hurdles to jump before your loan closes. Here are some things to avoid before closing to assure your transaction goes well.
Don't buy luxury items. You may be itching to turn your new living room into a showplace, or celebrate your new castle, but keep away from expensive purchases like furniture, cars, appliances, or vacations until closing. Your credit numbers could change suddenly if you purchase new furniture using credit cards. Since lenders are examining your bank accounts, a large cash purchase is also not advised.
Don't get a new career. Your recent job history should show stability. Getting a new career before you start the application process for a mortgage may not get in the way of your approval at all. However, if you switch careers before approval, your mortgage process could fail or be stalled.
Don't change banks or move cash around in your bank accounts. Most lenders will ask for recent bank statements of accounts in your name: checking, savings, money market, and other assets. In order to detect fraud, lenders look for a consistent portrayal of how you earn your living and where any additional funds come from. No matter the reason, changing banks or moving funds from one account to another might raise a red flag with your lender and slow your application process.
Don't give your FSBO (for sale by owner) seller earnest money, cash in hand. Until the sale is complete, the earnest money actually belongs to you. Some FSBO sellers might not realize that any good faith funds should go toward your expenses at closing. Find an attorney or other neutral person who will hang on to the deposit or place it in a trust account until you close. The disposition of good faith funds, in the case of a failed transaction, should be documented in the purchase agreement with the seller.
Bright Vision Mortgage can walk you through the pitfalls of getting a mortgage. Call us at (904) 342-3622.