Don't Trip Yourself up While Buying your Home
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With the thrill that comes with an accepted offer and a "yes" from the lender, many homebuyers make the mistake of taking their enthusiasm straight to the mall or appliance store. Until the house is really yours, there still remain some hurdles to jump. Below you'll find a list of actions to avoid during this crucial time of your home purchase.
Don't buy luxury items. You may be itching to turn your new kitchen into a showplace, or celebrate your new castle, but stay away from major purchases like furniture, jewelry, appliances, or vacations until closing. Using plastic to buy new living room furniture could compromise your loan process by changing your numbers dramatically. Since lenders are perusing your financial accounts, a large cash purchase is also not advised.
Don't look for a new career. Your recent career history should show consistency. Changing jobs may not jeopardize your ability to qualify for a mortgage loan - particularly if you are getting a better salary. However, switching jobs during the loan process could influence whether or not you are approved.
Don't move money around or change banks. While the lending institution considers your loan application, you will likely be required to submit bank statements for recent months for your checking and savings accounts, money market funds and other liquid wealth. To eliminate potential fraud, most lending institutions need thorough paperwork to determine the source of all funds. No matter the reason, changing banks or moving funds from one account to another can raise a red flag with your lender and slow your loan process.
Don't give cash directly to your seller (commonly in the case of of "for sale by owner") for earnest money. As a rule, your good faith money is yours, not the seller's up until the deal closes. Although your seller may not realize this, your earnest money should be used for your closing expenses. We recommend that you put the money into a trust account, or get a neutral party, like a lawyer, to hold it until closing. The final disposition of earnest money, in the case of a failed transaction, should be written in the contract with the seller.
Eagle Platinum Mortgage can answer questions about these "Don'ts" and many others. Give us a call: (800) 763-7154 EXT 3.