Things to Avoid While Purchasing a Home

With the thrill that comes with an accepted offer and a "yes" from the lender, many homebuyers make the mistake of carrying their enthusiasm straight to the mall or appliance store. It's wise to remember that until your keys are in hand, your lender is watching your finances very closely. We have listed some things below we suggest you avoid when waiting for your loan to close.

Don't make expensive purchases. You may be tempted to order that new couch for the soon-to-be-yours den, but it's best to stay away from making major purchases like furniture, appliances, electronic equipment, or cars until closing. Financing your stainless steel appliances with a store card or a bank credit card could put your credit worthiness at risk when you need it the most. It's even a mistake to make those large purchases using cash. Lending Institutions are examining your cash on hand when considering your loan.

Don't go on a job search. Lenders like to see a consistent career history on your application. Getting a new job before you start the application process for a mortgage may not affect your approval at all. However, if you switch careers before you qualify, your process could fail or be bogged down.

Don't move finances around or switch banks. Most lenders will ask for recent bank statements for accounts in your name: checking, savings, money market, and other assets. Your lender is looking for a steady rise and fall of your money over the month, in order to avoid fraud. No matter the reason, changing banks or transferring money can raise a red flag with the lender and slow your approval process.

Don't give your FSBO (for sale by owner) seller earnest money, delivered to his door. Your good faith deposit does not belong to the seller: it remains yours until the sale closes. Any earnest money is to be used for your expenses upon closing; some sellers may not realize this. It's advisable to put the funds into a trust account, or get an attorney to hold them until closing. If your sale falls through, the contract with the seller should dictate where the good faith deposit should go.

Primemax Mortgage Group, NMLS#195523 can walk you through the pitfalls of getting a mortgage. Call us: 2565439211.