What to Avoid During your Home Purchase
With the thrill that comes with an accepted offer and a "yes" from the lender, many homebuyers make the error of taking their enthusiasm straight to the mall or appliance store. Until the house is really yours, there still remain some hoops to jump through. We have given you a list of actions below we suggest you avoid when waiting for closing.
Don't overspend on big-ticket items You may be tempted to buy that new sofa for the soon-to-be-yours den, but it's best to stay away from making major purchases like furniture, appliances, electronic equipment, or vacations until closing. You may send up red flags with your lender if you buy your electronics on your credit cards in the middle of your loan process. Since lenders are reviewing your bank accounts, a large cash purchase is also not advised.
Don't look for a new career. Lenders like to see a consistent job history on your paperwork. Finding a new job (especially one with a bigger salary) may not jeopardize your ability to qualify for your mortgage. But for some, changing careers during the mortgage loan approval process might raise concern and affect your approval.
Don't move money around or change banks. While your lender reviews your mortgage loan package, you will probably be instructed to provide bank statements for recent months on your checking accounts, savings accounts, money market funds and other liquid assets. The lender needs to see a consistent rise and fall of your funds over the month, in order to avoid fraud. Changing banks or moving funds elsewhere - no matter the purpose - may hinder the review of your funds.
Don't give your FSBO (for sale by owner) seller a "good faith" deposit, delivered to his door. Until closing, any good faith deposit actually belongs to you. Your good faith money is to go toward your expenses upon closing; some individual sellers may not understand this. We recommend that you put the funds into a trust account, or get a neutral party, like an attorney to hold them until the closing of the sale. The disposition of earnest money, if your sale fails, should be documented in the purchase agreement with your seller.
Net Equity Financial Mortgage can walk you through the pitfalls of getting a mortgage. Call us: (215)741-3131.