Don't Trip Yourself up While Buying your Home

Many new homebuyers make the mistake of rushing out to buy things to fill their home soon after the seller says "yes" and the loan is approved. Until closing, there are still some hurdles to jump. We have given you a list of actions below you will want to avoid when waiting for closing.

Don't make expensive purchases. Although you may be planning ways to turn your new house into a castle, avoid major purchases like appliances, electronics, or furniture. We also recommend that you avoid vacations and car purchases until the closing of your loan. Using plastic to buy furniture could compromise your loan process by altering your numbers dramatically. Since lenders are looking closely at your bank accounts, a large cash purchase is also not advised.

Don't go on a career search. Your recent career history should show stability. Finding a new career (particularly one with a bump in salary) may not change your ability to qualify for a loan. But in some cases, changing jobs during the mortgage loan approval process might raise concern and stymie your application.

Don't take your accounts to a new bank or move around your cash. Bank statements from recent months for your accounts (savings, checking, money market, and other assets) will probably be studied as the lender makes decisions regarding your loan application. To eliminate fraud, lenders need a clear and consistent picture of how you earn your money and where any additional funds come from. No matter the reason, moving banks or transferring funds could raise a red flag with the lender and slow down your application process.

Don't give funds directly to your seller (usually in the case of of "for sale by owner") for earnest money. Until closing, the good faith money remains yours. Any earnest funds are to go toward your expenses upon closing; the individual seller may not realize this. A neutral party, like an attorney can hold your earnest money, or you may put it temporarily into a trust account until you close. The contract should document who gets the money if the home purchase falls through.

Price Mortgage Group LLC can answer questions about these "Don'ts" and many others. Call us at 405-513-7700.