Things to Avoid While Purchasing a Home
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Some new homebuyers make the mistake of rushing out to buy things to fill their home as soon as the seller accepts their offer and the lender approves the loan. There still remain a few major hurdles to jump before the keys are handed over. Here are some actions to avoid during the home buying process to assure the transaction goes smoothly.
Don't overspend on big-ticket items You may be itching to turn your new living room into a showplace, or celebrate your new dream home, but stay away from big purchases like furniture, cars, appliances, or vacations until the loan closes. Financing new furniture with a store card or a bank credit card could jeopardize your credit worthiness during the time it means the most. Using cash to purchase expensive items can even be a bad idea: many lenders take into consideration your available cash when approving your application.
Don't get a new job. Lenders look for a consistent job history on your application. Getting a new job may not jeopardize your ability to qualify for a loan - particularly if you are going to be making more money. However, if you switch careers before approval, your loan process could fail or be slowed down.
Don't move cash around or change banks. Your lender will instruct the submission of recent bank statements on accounts in your name: checking, savings, money market, and other assets. To eliminate fraud, lenders want to see a consistent portrayal of how you earn your living and where additional funds come from. Even for practical purposes, moving around finances or switching banks might make it difficult for your lender to confirm your account history.
Don't give your FSBO (for sale by owner) seller a "good faith" deposit, delivered to his door. As a rule, your good faith deposit is yours, not the seller's up until the deal closes. The FSBO seller might not realize that the good faith funds should be applied to your expenses upon closing. A neutral party, like an attorney can hang onto your earnest funds, or you may put them temporarily into a trust account until you close. Your purchase contract should specify who gets the deposit if the transaction does not go through.
At 1st Security Home Mortgage Corp, we answer questions about this process every day. Give us a call: 918-748-4470/877-748-4470.