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 soon after the seller accepts their offer and the loan is approved. There still remain a few major hurdles to jump before the keys are handed over. We have given you a list of things below you will want to avoid when waiting for your loan to close.

Don't buy big-ticket items. You may be itching to turn your new living room into a home magazine cover, or celebrate your new dream home, but stay away from expensive purchases like furniture, jewelry, appliances, or vacations until the loan closes. Your credit numbers could change suddenly if you purchase new furniture using credit cards. Because lending institutions are examining your financial accounts, a large cash purchase is also not advised.

Don't get a new job. Lending Institutions feel comfortable seeing a consistent work history on your application. Getting a new job before you apply for a loan may not jeopardize your approval at all. However, finding a new career in the middle of the loan process may affect your approval.

Don't change banks or move finances around in your bank accounts. Bank statements from recent months for accounts in your name (checking, savings, money market, and others) will probably be analyzed as the lender makes decisions regarding your approval. The lending institution is looking for a steady rise and fall of your funds over the month, in the interest of ruling out fraud. No matter the purpose, switching banks or transferring money may raise a red flag with your lender and slow down your loan process.

Don't give funds directly to your seller (usually in cases of "for sale by owner") for earnest money. Until the sale is complete, any good faith money remains yours. Some sellers may not know that any good faith funds must go toward your expenses upon closing. It's wise to put the funds into a trust account, or get an attorney to hold them until closing. Your purchase agreement should dictate who gets the earnest funds if the transaction does not go through.

At AmeriBest Mortgage, we answer questions about this process every day. Give us a call at 3217777277.