Don't Trip Yourself up While Buying your Home
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 furniture store. There are still a few major hurdles to jump before your loan closes. Below you'll find a list of actions to avoid during this critical time of your home purchase.
Don't empty your wallet on big-ticket items Although you will be planning ways to turn your new house into a castle, avoid big ticket purchases like appliances, electronics, or expensive furnishings. You will also want to stay away from vacations and vehicle purchases until the closing of your loan. Financing your Plasma TVs with a store card or a bank credit card could put your credit worthiness at risk when you need it the most. It's even a mistake to make those huge purchases with cash. Lending Institutions are examining your available cash when considering your loan.
Don't look for a new job. Lenders like to see a consistent job history on your application forms. Getting a new job before you apply for a mortgage loan may not compromise your approval at all. However, if you switch careers before you qualify, your loan process could fail or be slowed down.
Don't switch banks or move finances around in your bank accounts. As the lender reviews your mortgage application, you will likely be asked to provide bank statements for recent months for your checking accounts, savings accounts, money market accounts and other liquid wealth. To eliminate potential fraud, most lending institutions require a detailed paper trail to verify the source of all funds. Changing banks or transferring finances elsewhere - no matter the reason - might make it harder for the lender to verify your funds.
Don't deliver earnest money directly to the seller in a FSBO (for sale by owner) purchase. As a rule, your good faith money is yours, not the seller's up until the deal closes. Although your seller might not know this, the good faith money should go toward the buyer's closing expenses. A neutral party, like an attorney can hold onto your earnest money, or you may put it temporarily into a trust account until closing. Your contract should specify who gets the deposit if the home purchase does not go through.
Riviera Funding NMLS#861382 CA DRE Broker #01186669 can walk you through the pitfalls of getting a mortgage. Give us a call at 3103737406.