What to Avoid During your Home Purchase

What's more fun than getting a bunch of new stuff to go in your future home? Nothing. But buying big ticket items before closing can be an error. Until your keys are in hand, there are still some hurdles to jump. We have given you a list of actions below you will want to stay away from when waiting for closing.

Don't overspend on big-ticket items Although you may be planning ways to turn your new home into a castle, avoid big ticket purchases like appliances, electronics, or expensive furnishings. We also recommend that you keep away from vacations and car purchases until your loan closes. Financing new furniture with a store card or a bank credit card could jeopardize your credit worthiness when you need it the most. Using cash to buy big items can even create a mistake: most lending institutions consider your cash reserve when approving your mortgage.

Don't look for a new job. Your recent career history should show consistency. Finding a new job (especially one with a better salary) may not change your ability to qualify for a loan. But in some cases, getting a new job during the mortgage approval process may bring concern and affect your application.

Don't move finances around or change banks. Your lender will ask for recent bank statements on accounts in your name: savings, checking, money market, and other assets. In order to detect fraud, lenders look for clear documentation of how you earn your money and where any additional money comes from. Switching banks or transferring money elsewhere - no matter the purpose - may hinder the documentation of your accounts.

Don't give your FSBO (for sale by owner) seller a "good faith" deposit, made out directly to him. Until closing, any good faith deposit remains yours. The good faith money is to be applied to your expenses closing; a individual seller might not know this. An attorney or other type of neutral party can hold onto your funds, or you may put them temporarily into a trust account until you close. If your sale falls through, your purchase agreement should dictate where this earnest money should go.

At AmeriBest Mortgage, we answer questions about this process every day. Call us: 3217777277.