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 closing. We have given you a list of things 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 order that new sofa for the soon-to-be-yours den, but it's advisable to avoid making big ticket buys like furniture, appliances, electronic equipment, or vacations until your home loan closes. Using plastic to buy furniture could jeopardize your loan process by distorting your numbers. It's even a mistake to make those big-ticket purchases with cash. Lenders are examining your cash reserve when considering your loan.
Don't get a new job. Consistency in your job history is a positive thing to lenders. Changing jobs may not affect your ability to qualify for a loan - especially if you are improving your salary. But for some people, changing jobs during the loan application process may bring concern and hinder your application.
Don't switch banks or move finances around in your bank accounts. While the lender considers your loan package, you will likely be instructed to submit bank statements for the last two or three months for your checking accounts, savings accounts, money market accounts and other liquid finances. To detect fraud, lenders will need a consistent portrayal of how you earn your living and where any additional money comes from. Changing banks or moving money elsewhere - no matter the reason - may make it difficult for your lender to verify your funds.
Don't give your FSBO (for sale by owner) seller a "good faith" deposit, cash in hand. As a rule, your earnest money is yours, not the seller's up until the sale is final. The earnest funds are to be applied to your expenses closing; some individual sellers may not know this. A neutral party, like an attorney can hold onto your funds, or you may put them temporarily into a trust account until closing. The disposition of good faith money, if your sale fails, should be documented in the contract with the seller.
At Tenby J. Dahman The Dahman Team , we answer questions about this process every day. Give us a call: 3038627760.