Things to Avoid While Buying a Home
Some new homebuyers make the mistake of rushing out to buy things to fill their home as soon as the seller says "yes" and the loan is approved. Until closing, there are still some hurdles to jump. Here are some actions to stay clear of during the home buying process to assure the transaction goes well.
Don't make expensive purchases. Although you may be planning ways to turn your new house into a castle, try to stay away from big ticket purchases like appliances, electronics, or expensive furnishings. We also recommend that you keep away from vacations and car purchases until the closing of your loan. Financing your stainless steel appliances with a store card or a bank credit card could jeopardize your credit worthiness when you need it the most. It's also a bad idea to make those large purchases using cash. Lending Institutions are examining your available cash when considering your loan.
Don't get a new job. Lenders look for a consistent job history on your application forms. Finding a new career (particularly one with a bigger paycheck) may not change your ability to qualify for your mortgage. However, if you switch careers before your loan is approved, your process could fail or be bogged down.
Don't change banks or move money around in your bank accounts. While the lender considers your loan package, you will probably be required to provide bank statements for the last two or three months on your checking and savings accounts, money market accounts and other liquid finances. The lender is looking for a consistent flow of your funds over the month, in order to avoid fraud. Switching banks or moving funds elsewhere - even if its only to consolidate funds - could hinder the documentation of your accounts.
Don't hand over a "good faith" deposit directly to the seller in a FSBO (for sale by owner) purchase. Until closing, any earnest money actually belongs to you. The FSBO seller may not know that any good faith money should be used for your expenses at closing. It's best to put the funds into a trust account, or get an attorney to hold them until the closing of the sale. Your purchase agreement should indicate where the funds go if the transaction fails.
Coleman Mortgage Company can walk you through the pitfalls of getting a mortgage. Call us: 972-932-9083.