Don't Trip Yourself up While Buying your New Home
What's more fun than buying a bunch of new stuff to go in your future home? Not much. But making big purchases before closing could be trouble. There still remain a few major hurdles to jump before closing. We have listed some actions below you will want to avoid when waiting for your loan to close.
Don't buy big-ticket items. You may be itching to turn your new living room into a showplace, or celebrate your new dream home, but keep away from expensive purchases like furniture, jewelry, appliances, or vacations until closing. Your credit numbers could be altered suddenly if you purchase new furniture using credit cards. It's even a red flag to make those large purchases using cash. Lending Institutions are looking at your available cash when considering your loan.
Don't look for a new career. Your recent work history should show consistency. Getting a new job before you apply for a loan may not jeopardize your approval at all. However, switching jobs during the application process may affect your approval.
Don't take your accounts to a new bank or move around your finances. Bank statements from the last few months for your accounts (savings, checking, money market, and others) will probably be studied as the lender makes decisions regarding your approval. To avoid potential fraud, most lending institutions require thorough paperwork to verify the source of all incoming funds. Even for innocent purposes, moving around money or changing banks may make it more difficult for the lender to verify your bank history.
Don't give your FSBO (for sale by owner) seller a "good faith" deposit, cash in hand. As a rule, your good faith money is yours, not the seller's up until closing. Any earnest funds are to be applied to your expenses closing; your individual seller may not understand this. We recommend that you put the deposit into a trust account, or get a neutral party, like an attorney, to hold it until the deal closes. The contract should specify where the funds go if the home purchase fails.
Affirm Home Loans can answer questions about these "Don'ts" and many others. Call us: (972) 292-0448.