Things to Avoid While Buying a Home
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With the thrill that comes with an accepted offer and a "yes" from the lender, many homebuyers make the error of carrying their enthusiasm straight to the mall or appliance store. Until your loan closes, there still remain some hoops to jump through. We have listed some actions below we suggest you stay away from when waiting for closing.
Don't make expensive purchases. Although you may be listing ways to turn your new house into a showplace, avoid big ticket purchases like appliances, electronics, or expensive furnishings. You will also want to avoid vacations and vehicle purchases until your loan closes. Your credit numbers could be altered suddenly if you purchase new furniture using plastic. It's even a mistake to make those big purchases with cash. Lenders are looking at your available cash when considering your loan.
Don't get a new career. Lenders feel comfortable seeing a consistent job history on your application forms. Finding a new job (especially one with a bigger paycheck) may not hinder your ability to qualify for a mortgage loan. However, if you switch careers before your loan is approved, your loan process could fail or be stalled.
Don't move money around or switch banks. Your lending institution will instruct the submission of recent bank statements on all of your accounts: checking, savings, money market, and other assets. To avoid potential fraud, most lending institutions need thorough paperwork to verify the source of all incoming funds. Even for innocent reasons, moving around funds or changing banks could make it more difficult for your lending institution to verify your bank history.
Don't give a "good faith" deposit directly to the seller in a FSBO (for sale by owner) purchase. Your good faith deposit does not belong to the seller: it is actually yours until closing. Your FSBO seller may not know that your earnest money is to go toward your expenses upon closing. It's best to put the deposit into a trust account, or get a neutral party, like an attorney, to hold it until closing. Your purchase agreement should indicate who keeps the earnest funds if the home purchase fails.
SquareLend can walk you through the pitfalls of getting a mortgage. Give us a call at 5627733870.