Things to Avoid While Purchasing a Home

Some new homebuyers make the mistake of rushing out to buy things to fill their home soon after the seller accepts their offer and the loan is approved. It's best to remember that until your keys are in hand, your lender is watching your finances very closely. Below you'll find a list of things to avoid during this crucial time of your home purchase.

Don't throw your money around. You may be itching to turn your new kitchen into a home magazine cover, or celebrate your new dream home, but stay away from expensive purchases like furniture, cars, appliances, or vacations until the loan closes. Your credit numbers could be altered suddenly if you make a huge purchase using plastic. It's even a red flag to make those large purchases with cash. Lending Institutions are looking at your cash on hand when considering your loan.

Don't look for a new career. Your recent job history should show consistency. Changing jobs may not jeopardize your ability to qualify for a loan - particularly if you are getting a bigger paycheck. However, switching careers in the middle of the approval process may influence whether or not you are approved.

Don't take your accounts to a new bank or move around your cash. As your lending institution reviews your loan application, you will probably be required to provide bank statements for the last few months on your checking accounts, savings accounts, money market accounts and other liquid finances. To eliminate fraud, lenders require a consistent portrayal of how you earn your money and where any additional money comes from. Changing banks or transferring funds to another account - for whatever reason - could make it difficult for your lender to verify your funds.

Don't give your FSBO (for sale by owner) seller earnest money, delivered to his door. Until the sale is complete, any good faith deposit remains yours. Your FSBO seller may not know that your good faith funds is to be used for your expenses upon closing. You'll need to put the deposit into a trust account, or get an attorney to hold it until closing. The final disposition of good faith funds, if your transaction fails, should be specified in the purchase agreement with the seller.

Pacificwide Lending can walk you through the pitfalls of getting a mortgage. Give us a call: 9254610500.