Don't Trip Yourself up While Buying your New Home

What's better than getting a bunch of new furniture to go in your future home? Nothing. But making big ticket purchases before your loan closes could be trouble. There are still a few major hurdles to jump before closing. We have given you a list of actions below you will want to stay away from when waiting for your loan to close.

Don't make expensive purchases. You may be itching to turn your new kitchen into a home magazine cover, or celebrate your new castle, but keep away from expensive purchases like furniture, jewelry, appliances, or vacations until your loan closes. Your credit numbers could be altered suddenly if you make a huge purchase using credit cards. It's also a bad idea to make those large purchases using cash. Lending Institutions are looking at your available cash when considering your loan.

Don't go on a job search. Lenders feel comfortable seeing a consistent career history on your application. Finding a new career (especially one with a bigger salary) may not jeopardize your ability to qualify for a loan. However, if you switch careers before approval, your mortgage process could fail or be slowed down.

Don't change banks or move cash around in your accounts. Your lender will instruct the submission of recent bank statements of all of your accounts: checking, savings, money market, and other liquid assets. To detect potential fraud, most loans need a detailed paper trail to determine the source of all funds. No matter the purpose, moving banks or moving money from one account to another could raise a red flag with your lender and slow down your qualification process.

Don't give cash directly to your seller (generally in the case of of "for sale by owner") to be considered earnest money. Until the completion of the deal, any earnest money remains yours. Your good faith money is to go toward your expenses closing; a FSBO seller might not know this. Find a lawyer or other neutral person who will hold the money or put it in a trust account until closing. The disposition of earnest funds, if your transaction falls through, should be indicated in the purchase agreement with the seller.

American Mortgage Advisers, Inc can walk you through the pitfalls of getting a mortgage. Give us a call at 2148657442.