Don't Trip Yourself up While Buying your New Home
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What's better than buying a bunch of new furniture to adorn your future home? Nothing. But making big ticket purchases before closing could be trouble. There still remain a few major hurdles to jump before closing. Below you'll find a list of things to stay away from during this crucial time of your home purchase.
Don't throw your money around. Although you will be dreaming of ways to turn your new home into a showplace, avoid major purchases like appliances, electronics, or furniture. You will also want to keep away from vacations and car purchases until your loan closes. Your credit numbers could be altered suddenly if you purchase new furniture using plastic. Because lenders are examining your financial accounts, a large cash purchase is also a bad idea.
Don't go on a job search. Consistency in your career history is a positive thing to lending institutions. Finding a new job (especially one with a bigger salary) may not jeopardize your ability to qualify for your mortgage loan. However, switching careers in the middle of your approval process could influence whether or not you are approved.
Don't move money around or switch banks. Your lender will instruct the submission of recent bank statements on accounts in your name: savings, checking, money market, and other liquid assets. The lending institution is looking for a consistent flow of your funds each month, in order to avoid fraud. Changing banks or moving funds elsewhere - no matter the reason - could hinder the documentation of your accounts.
Don't deliver earnest money directly to the seller in a FSBO (for sale by owner) purchase. As a rule, your good faith deposit is yours, not the seller's until the deal closes. Some sellers might not realize that your good faith money must be used for your expenses upon closing. Get a lawyer or other neutral party who is able to hang on to the funds or place them in a trust account until you close. The final disposition of good faith funds, in the case of a failed transaction, should be included in the contract with your seller.
Arch Mortgage Corporation can walk you through the pitfalls of getting a mortgage. Give us a call at 561.775.2724.
Corporation can walk you through the pitfalls of getting a mortgage. Give us a call at 561.775.2724.