Don't Trip Yourself up While Buying a Home
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Some new homebuyers make the mistake of rushing out to buy new things for their home soon after the seller accepts their offer and the loan is approved. Keep in mind that until you get the keys, your lender is watching you very closely. We have given you a list of things below you will want to stay away from when waiting for closing.
Don't buy big-ticket items. Although you may be planning ways to turn your new home into a castle, avoid major purchases like appliances, electronics, or expensive furnishings. You will also want to keep away from vacations and vehicle purchases until your loan closes. Your lender may send up red flags if you purchase new furniture on your credit cards during your loan process. It's even a red flag to make those big purchases with cash. Lending Institutions are examining your cash on hand when considering your loan.
Don't look for a new job. Your recent career history should show consistency. Getting a new job before you start the application process for a loan may not affect your approval at all. However, if you switch careers before your loan is approved, your mortgage process could fail or be bogged down.
Don't take your accounts to a new bank or move around your finances. Bank statements from recent months for accounts in your name (savings, checking, money market, and others) will likely be reviewed as the lender makes decisions regarding your mortgage application. To eliminate fraud, lenders need a clear and consistent picture of how you earn your living and where additional money comes from. Even for innocent reasons, transferring funds or changing banks might make it more difficult for the lending institution to document your bank history.
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 closing. Your earnest funds are to go toward your expenses closing; some sellers might 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 closing. If your home purchase fails, the purchase contract should document to whom this good faith funds should go.
Alpine Capital Mortgage can answer questions about these "Don'ts" and many others. Give us a call at (208) 726-5466.
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