Don't Trip Yourself up While Buying your New Home

Many new homebuyers make the mistake of rushing out to buy new things for their home soon after the seller accepts their offer and the loan is approved. Keep in mind that until your keys are in hand, your lender is watching your finances very closely. Here are some things to avoid during the home buying process to assure your transaction goes well.

Don't throw your money around. Although you may be dreaming of ways to turn your new house into a castle, try to stay away from major purchases like appliances, electronics, or expensive furnishings. You will also want to avoid vacations and vehicle purchases until your loan closes. Your credit numbers could change suddenly if you make a huge purchase using credit cards. Using cash to buy big-ticket items can even be a bad idea: most lenders take into consideration your available cash when approving your mortgage loan.

Don't go on a job search. Your recent career history should show stability. Getting a new job may not jeopardize your ability to qualify for a mortgage loan - especially if you are improving your salary. However, if you switch careers before you qualify, your process could fail or be stalled.

Don't move money around or change banks. Your lending institution will require you to submit recent bank statements of all of your accounts: savings, checking, money market, and other liquid assets. The lending institution is looking for a consistent flow of your funds over the month, in order to rule out fraud. Changing banks or moving funds elsewhere - no matter the reason - may make it difficult for your lender to review your funds.

Don't hand over a "good faith" deposit directly to the seller in a FSBO (for sale by owner) purchase. As a rule, your good faith money is yours, not the seller's until the sale is final. Some sellers might not know that any good faith funds should be used for your expenses at closing. We recommend that you put the deposit into a trust account, or get an attorney to hold it until closing. The purchase contract should indicate who gets the deposit if the transaction falls through.

Advantage Home Lenders can answer questions about these "Don'ts" and many others. Give us a call at 6317360419.