Don't Trip Yourself up While Buying your Home
In the rush of excitement that comes with an accepted offer and a "yes" from the lender, many homebuyers make the mistake of taking their enthusiasm straight to the mall or furniture store. Until the keys are handed over, there still remain some hoops to jump through. We have listed some things below we suggest you avoid when waiting for your loan to close.
Don't empty your wallet on big-ticket items Although you may be planning ways to turn your new house into a showplace, avoid major purchases like appliances, electronics, or furniture. We also recommend that you avoid vacations and car purchases until the closing of your loan. Your credit numbers could change suddenly if you purchase new furniture using plastic. It's even a bad idea to make those large purchases using cash. Lending Institutions are examining your available cash when considering your loan.
Don't look for a new career. Your recent job history should show consistency. Finding a new career (especially one with a bump in salary) may not change your ability to qualify for your mortgage loan. However, switching jobs during your approval process may affect your approval.
Don't move cash around or switch banks. Your lending institution will require you to produce recent bank statements of accounts in your name: savings, checking, money market, and other liquid assets. In order to detect fraud, lenders want to see a clear and consistent picture of how you earn your living and where additional wealth comes from. No matter the reason, moving banks or moving funds from one account to another might raise a red flag with the lender and impede your approval process.
Don't give money directly to your seller (commonly in cases of "for sale by owner") for a "good faith" deposit. Until the completion of the deal, any good faith deposit remains yours. Although your seller may not realize this, the good faith money must be applied to your closing expenses. An attorney or other type of neutral party can hang onto your earnest money, or you may put it temporarily into a trust account until closing. If your sale falls through, your purchase contract should indicate where this earnest money should go.
At America's Home Loans, we answer questions about this process every day. Give us a call: 701.222.0100.