Things to Avoid While Purchasing a New Home
Many new homebuyers make the mistake of rushing out to buy things to fill their home soon after the seller accepts their offer and the lender approves the loan. It's wise to remember that until closing, your lender is watching you very closely. Below you'll find a list of things to stay away from during this critical time of your home purchase.
Don't buy big-ticket items. Although you will be dreaming of ways to turn your new house into a showplace, try to stay away from major purchases like appliances, electronics, or expensive furnishings. You will also want to stay away from vacations and car purchases until the closing of your loan. Using plastic to buy new living room furniture could compromise your loan process by distorting your numbers. Using cash to buy big-ticket items can also create a bad idea: most lending institutions look at your available cash when approving your mortgage.
Don't go on a job search. Stability in your job history is a good thing to lenders. Getting a new job may not compromise your ability to qualify for a mortgage loan - especially if you are getting a bigger paycheck. But for some, getting a new job during the mortgage approval process may raise concern and hinder your application.
Don't change banks or move money around in your accounts. Bank statements from recent months for accounts in your name (savings, checking, money market, and other assets) will likely be reviewed as the lender considers your application. The lending institution looks for a steady flow of your money over the month, in order to avoid fraud. No matter the purpose, changing banks or transferring funds might raise a red flag with your lender and slow your qualification process.
Don't deliver a "good faith" deposit directly to the seller in a FSBO (for sale by owner) purchase. Until the completion of the deal, the earnest money actually belongs to you. Your good faith funds are to be used for your expenses closing; your FSBO seller may not understand this. An attorney or other type of neutral party can hang onto your earnest funds, or you may put them temporarily into a trust account until you close. If your transaction fails, the purchase contract should specify where your good faith funds should go.
Coastal Mortgage Corp. can answer questions about these "Don'ts" and many others. Call us at 504-866-5626.
Get the Best Mortgage Rate! Tell us a little about your current needs and we can use that information to match you with just the right loan.