Things to Avoid While Purchasing a New Home
What's better than getting a bunch of new stuff to go in 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 stay clear of before closing to be sure the transaction goes well.
Don't buy big-ticket items. You may be itching to turn your new kitchen into a home magazine cover, or celebrate your new castle, but stay away from major purchases like furniture, cars, appliances, or vacations until closing. Your credit numbers could be altered suddenly if you purchase new furniture using plastic. Because lending institutions are examining your financial accounts, a large cash purchase is also a mistake.
Don't look for a new career. Your recent work history should show stability. Finding a new job (especially one with a bump in salary) may not change your ability to qualify for a mortgage. But for some, getting a new career during the mortgage approval process could bring concern and affect your application.
Don't move cash around or change banks. Your lender will require you to produce recent bank statements of your accounts: checking, savings, money market, and other liquid assets. To eliminate potential fraud, most loans need a detailed paper trail to verify the source of all funds. Even for practical purposes, transferring money or switching banks may make it harder for your lender to document your bank history.
Don't give earnest money directly to the seller in a FSBO (for sale by owner) purchase. Until the completion of the deal, any good faith deposit remains yours. Some FSBO sellers might not realize that the good faith funds is to be applied to your expenses upon closing. You'll need to put the deposit into a trust account, or get an attorney to hold it until the deal closes. The final disposition of good faith money, in the case of a failed transaction, should be specified in the purchase agreement with your seller.
Crown Mortgage can answer questions about these "Don'ts" and many others. Give us a call at (434) 975-5626.
Got a Question?
Do you have a question? We can help. Simply fill out the form below and we'll contact you with the answer, with no obligation to you. We guarantee your privacy.