Things to Avoid While Buying a New Home

What's more fun than getting a bunch of new stuff to adorn your future home? Nothing. But buying big ticket items before closing could be trouble. Until the house is really yours, there are still some hurdles to jump. Here are some actions to refrain from before closing to assure the transaction goes well.

Don't throw your money around. Although you will be dreaming of ways to turn your new home into a showplace, try to stay away from big ticket purchases like appliances, electronics, or furniture. We also recommend that you keep away from vacations and vehicle purchases until your loan closes. You may send up red flags with your lender if you purchase new appliances on your credit cards during your loan process. Because lenders are looking closely at your financial accounts, a large cash purchase is also a bad idea.

Don't get a new job. Lending Institutions look for a consistent job history on your paperwork. Changing jobs may not jeopardize your ability to qualify for a mortgage loan - especially if you are improving your salary. However, switching careers in the middle of your approval process may affect your approval.

Don't switch your accounts to a new bank or move around your finances. Bank statements from recent months for all of your accounts (checking, savings, money market, and other accounts) will probably be studied as the lender makes decisions regarding your approval. To detect potential fraud, most lending institutions require a thorough paper trail to determine the source of all funds. Even for innocent purposes, moving around funds or changing banks may make it difficult for the lending institution to document your bank history.

Don't give your FSBO (for sale by owner) seller earnest money, cash in hand. Until closing, the good faith money actually belongs to you. Although your seller might not understand this, any earnest money should go toward your closing expenses. A neutral party, like an attorney can hold your deposit, or you may put it temporarily into a trust account until closing. The contract should specify who keeps the money if the home purchase falls through.

Firelight Mortgage Consultants can walk you through the pitfalls of getting a mortgage. Call us: 3032282254.