Don't Trip Yourself up While Buying a Home

With the thrill that comes with an accepted offer and a "yes" from the lender, many homebuyers make the mistake of carrying their enthusiasm straight to the mall or appliance store. It's best to remember that until closing, your lender is watching your finances very closely. Here are some things to avoid before closing to be sure your transaction goes well.
Don't empty your wallet on big-ticket items You may be tempted to buy that new Turkish rug for the soon-to-be-yours living room, but it's advisable to stay away from making large buys like furniture, appliances, jewelry, or cars until closing. Using credit cards to buy furniture could jeopardize your loan process by altering your numbers dramatically. Because lenders are perusing your bank accounts, a large cash purchase is also not advised.
Don't get a new job. Lenders feel comfortable seeing a consistent work history on your paperwork. Finding a new career (especially one with a bigger salary) may not affect your ability to qualify for a mortgage loan. But for some people, changing jobs during the loan application process might bring concern and hinder your approval.
Don't change banks or move money around in your accounts. Bank statements from recent months for accounts in your name (checking, savings, money market, and others) will likely be studied as the lending institution makes decisions regarding your loan application. To eliminate potential fraud, most loans require a thorough paper trail to verify the source of all cash. Even for practical reasons, transferring funds or switching banks may make it harder for your lending institution to document your account history.
Don't give money directly to your seller (commonly in cases of "for sale by owner") for earnest money. Until the sale is complete, the good faith money actually belongs to you. Some FSBO sellers may not know that the earnest money is to go toward your expenses upon closing. It's advisable to put the funds into a trust account, or get an attorney to hold them until the closing of the sale. The purchase contract should document to whom the money goes if the transaction fails.
U.S.A. Lending, Inc. can walk you through the pitfalls of getting a mortgage. Give us a call: 305-967-7200.