Don't Trip Yourself up While Buying a New Home
Some new homebuyers make the mistake of rushing out to buy new things for their home soon after the seller says "yes" and the loan is approved. Until your keys are in hand, there are still some hoops to jump through. Here are some things to stay clear of during the home buying process to be sure your transaction goes well.
Don't throw your money around. You may be itching to turn your new living room into a showplace, or celebrate your new dream home, but stay away from big purchases like furniture, cars, appliances, or vacations until closing. Your credit numbers could be altered suddenly if you make a huge purchase using credit cards. Since lending institutions are reviewing your financial accounts, a large cash purchase is also not advised.
Don't get a new job. Your recent career history should show consistency. Changing jobs may not jeopardize your ability to qualify for a loan - especially if you are getting a bigger paycheck. But for some, getting a new career during the mortgage application process might bring concern and stymie your approval.
Don't move money around or switch banks. Your lending institution will ask for recent bank statements of all of your accounts: checking, savings, money market, and other assets. To avoid potential fraud, most loans require a thorough paper trail to document the source of all incoming funds. Changing banks or moving funds to another account - for whatever purpose - may hinder the documentation of your funds.
Don't deliver earnest money directly to the seller in a FSBO (for sale by owner) purchase. Your good faith deposit does not belong to the seller: it remains yours until the transaction is final. Some sellers may not know that the good faith funds should be applied to your expenses upon closing. You'll need to put the funds into a trust account, or get a neutral party, like a lawyer to hold them until closing. Your purchase agreement should specify who keeps the deposit if the transaction fails.
Reliance Mortgage Service, Inc can walk you through the pitfalls of getting a mortgage. Call us: 5623200510.