Things to Avoid While Buying a Home

Some 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 their loan. Until the keys are handed over, there are still some hoops to jump through. Below you'll find a list of actions to stay away from during this critical time of your home purchase.

Don't overspend on big-ticket items Although you will be listing ways to turn your new home into a castle, try to stay away from major purchases like appliances, electronics, or furniture. We also recommend that you keep away from vacations and vehicle purchases until the closing of your loan. Your lender may send up red flags if you finance your furniture on your credit cards during your loan process. Because lenders are reviewing your financial accounts, a large cash purchase is also a bad idea.

Don't get a new career. Your recent career history should show consistency. Finding a new career (particularly one with a bump in salary) may not hinder your ability to qualify for a mortgage. However, if you switch careers before your loan is approved, your process could fail or be stalled.

Don't switch your accounts to a new bank or move around your finances. Bank statements from the last few months for accounts in your name (checking, savings, money market, and other accounts) will likely be studied as the lender considers your approval. In order to detect fraud, lenders need clear documentation of how you earn your living and where additional wealth comes from. Even for innocent purposes, transferring funds or switching banks could make it difficult for the lender to confirm your account history.

Don't give your FSBO (for sale by owner) seller a "good faith" deposit, delivered to his door. Until the sale is complete, the earnest money remains yours. The FSBO seller may not know that your good faith funds is to go toward your expenses at closing. Get an attorney or other neutral person who can hold the funds or put them in a trust account until closing. If your transaction fails, your contract with the seller should document where the earnest money should go.

Tier One Mortgage, LLC can walk you through the pitfalls of getting a mortgage. Give us a call: 5852820960.