Don't Trip Yourself up While Buying your New Home

In the rush of excitement that comes with an accepted offer and a "yes" from the lender, some homebuyers make the mistake of carrying their enthusiasm straight to the mall or furniture store. There are still a few major hurdles to jump before closing. We have given you a list of things below you will want to avoid when waiting for your loan to close.

Don't empty your wallet on big-ticket items You may be itching to turn your new living room into a home magazine cover, or celebrate your new castle, but stay away from major purchases like furniture, cars, appliances, or vacations until the loan closes. Using credit cards to buy new living room furniture could compromise your lending process by changing your numbers dramatically. Since lending institutions are examining your bank accounts, a large cash purchase is also not advised.

Don't look for a new career. Lenders feel comfortable seeing a consistent work history on your application forms. Getting a new job may not compromise your ability to qualify for a mortgage loan - especially if you are getting a bigger paycheck. But in some cases, changing careers during the mortgage approval process may bring concern and hinder your approval.

Don't move money around or change banks. Most lenders will instruct the submission of recent bank statements on accounts in your name: savings, checking, money market, and other liquid assets. Your lending institution is looking for a consistent flow of your funds each month, in the interest of ruling out fraud. Even for innocent reasons, transferring finances or changing banks might make it more difficult for your lender to document your account history.

Don't hand over earnest money directly to the seller in a FSBO (for sale by owner) purchase. Your earnest money does not belong to the seller: it is actually yours until the sale closes. Although some individual sellers might not realize this, any good faith funds must go toward your closing expenses. Find an attorney or other neutral party who will hang on to the money or place it in a trust account until closing. Your purchase contract should indicate to whom the money goes if the home purchase does not go through.

At ADVISORY MORTGAGE, we answer questions about this process every day. Give us a call: 8102292820.