Dont's When Purchasing a Home
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Lots of new homebuyers make the mistake of rushing out to buy new things for their home as soon as the seller accepts their offer and the loan is approved. There are still a few major hurdles to jump before the keys are handed over. Below you'll find a list of things to stay away from during this crucial time of your home purchase.
Don't make expensive purchases. Although you will be listing ways to turn your new home into a showplace, avoid major purchases like appliances, electronics, or expensive furnishings. You will also want to stay away from vacations and vehicle purchases until your loan closes. Your credit numbers could be altered suddenly if you make a huge purchase using plastic. Since lenders are reviewing your financial accounts, a large cash purchase is also not advised.
Don't look for a new job Your recent career history should show stability. Getting a new career before you apply for a mortgage loan may not get in the way of your approval at all. But for some, switching jobs during the mortgage loan application process could bring concern and hinder your approval.
Don't switch your accounts to a new bank or move around your cash. Your lending institution will ask for recent bank statements for accounts in your name: checking, savings, money market, and other liquid assets. The lending institution looks for a steady rise and fall of your money each pay period, in the interest of ruling out fraud. No matter the reason, moving banks or transferring funds can raise a red flag with the lender and slow your application process.
Don't give your FSBO (for sale by owner) seller a "good faith" deposit, delivered to his door. Your good faith deposit does not belong to the seller: it is actually yours until the transaction is final. The good faith funds are to be used for your expenses closing; the individual seller might not understand this. We recommend that you put the funds into a trust account, or get a neutral party, like a lawyer to hold them until the closing of the sale. Your purchase agreement should indicate who gets the deposit if the transaction fails.
Empower Lending Group can walk you through the pitfalls of getting a mortgage. Give us a call: 310-686-1313.