Don't Trip Yourself up While Buying a Home
Many new homebuyers make the mistake of rushing out to buy new things for their home soon after the seller accepts their offer and the loan is approved. Until your loan closes, there still remain some hoops to jump through. We have listed some actions below you will want to stay away from when waiting for your loan to close.
Don't make expensive purchases. You may be tempted to buy that new Turkish rug for the soon-to-be-yours parlor, but it's advisable to avoid making major buys like furniture, appliances, electronic equipment, or vacations until closing. Using credit cards to buy furniture could compromise your lending process by altering your numbers dramatically. Using cash to buy big items can even be an issue: many banks consider your cash reserve when approving your mortgage loan.
Don't get a new career. Your recent job history should show consistency. Getting a new career before you apply for a mortgage may not affect your approval at all. However, if you switch careers before you qualify, your mortgage process could fail or be stalled.
Don't move money around or change banks. Bank statements from the last few months for accounts in your name (checking, savings, money market, and other accounts) will probably be reviewed as the lender considers your application. To detect fraud, lenders need clear documentation of how you earn your money and where additional funds come from. Changing banks or transferring money to another account - for whatever reason - could hinder the documentation of your accounts.
Don't give your FSBO (for sale by owner) seller a "good faith" deposit, delivered to his door. Your earnest money does not belong to the seller: it remains yours until the sale closes. Although some FSBO sellers may not realize this, any good faith money should be applied to the buyer's closing expenses. You'll need to put the deposit into a trust account, or get an attorney to hold it until the deal closes. The disposition of good faith money, if your sale falls through, should be included in the purchase agreement with your seller.
Abbey Mortgage can walk you through the pitfalls of getting a mortgage. Give us a call: 352-369-4200.