What to Avoid During your Home Purchase
With the thrill 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 appliance store. Until the house is really yours, there are still some hoops to jump through. Below you'll find a list of actions to stay away from during this crucial time of your home purchase.
Don't make expensive purchases. Although you may be planning ways to turn your new home into a showplace, avoid major purchases like appliances, electronics, or expensive furnishings. We also recommend that you avoid vacations and vehicle purchases until the closing of your loan. Using credit cards to buy furniture could compromise your lending process by changing your numbers dramatically. It's even a mistake to make those big-ticket purchases with cash. Lenders are examining your cash reserve when considering your loan.
Don't get a new career. Lending Institutions look for a consistent work history on your paperwork. Finding a new career (especially one with a better salary) may not hinder your ability to qualify for a mortgage loan. However, switching careers in the middle of the application process might influence your approval.
Don't take your accounts to a new bank or move around your money. Bank statements from the last few months for all of your accounts (checking, savings, money market, and other accounts) will be studied as the lender makes decisions regarding your application. In order to detect fraud, lenders will need clear documentation of how you earn your money and where any additional money comes from. Even for practical purposes, transferring finances or changing banks could make it difficult for the lending institution to verify your bank history.
Don't give your FSBO (for sale by owner) seller earnest money, delivered to his door. Until the completion of the deal, any earnest money remains yours. Your seller might not realize that any good faith money is to be used for your expenses upon closing. We recommend that you put the money into a trust account, or get an attorney to hold it until the closing of the sale. Your contract should specify who gets the deposit if the transaction falls through.
Asset Alliance Mortgage can answer questions about these "Don'ts" and many others. Call us: (760) 632-7701.