Don't Trip Yourself up While Buying a New Home

Some new homebuyers make the mistake of rushing out to buy new things for their home as soon as the seller accepts their offer and the lender approves their loan. There are still a few major hurdles to jump before the house is realy yours. Here are some things to refrain from during the home buying process to assure the transaction goes smoothly.

Don't empty your wallet on big-ticket items 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 closing. You may send up red flags with your lender if you buy new furniture on your credit cards during your loan process. It's even a mistake to make those large purchases with cash. Lenders are looking at your available cash when considering your loan.

Don't look for a new career. Consistency in your job history is a positive thing to lenders. Changing jobs may not affect your ability to qualify for a loan - especially if you are improving your salary. However, switching jobs during your loan process may influence your approval.

Don't move finances around or change banks. Your lending institution will require you to submit recent bank statements of accounts in your name: checking, savings, money market, and other assets. In order to avoid fraud, lenders want to see a clear and consistent picture of how you earn your living and where any additional wealth comes from. Even for innocent reasons, moving around finances or changing banks may make it difficult for the lender to verify your account history.

Don't give cash directly to your seller (generally in the case of of "for sale by owner") to be considered a "good faith" deposit. As a rule, your earnest money is yours, not the seller's until the deal closes. Although your FSBO seller might not know this, any good faith money must go toward the buyer's closing expenses. An attorney or other type of neutral party can hang onto your funds, or you may place them temporarily into a trust account until you close. The purchase agreement should indicate who gets the earnest funds if the transaction falls through.

At Amity Mortgage LLC, we answer questions about this process every day. Give us a call at 2037296681.