Things to Avoid While Buying a New Home

Many new homebuyers make the mistake of rushing out to buy new things for their home as soon as the seller says "yes" and the loan is approved. Keep in mind that until you get the keys, your lender is watching your finances very closely. Here are some actions to stay clear of during the home buying process to assure your transaction goes well.

Don't empty your wallet on big-ticket items Although you may be listing ways to turn your new house into a castle, avoid major purchases like appliances, electronics, or expensive furnishings. You will also want to keep away from vacations and vehicle purchases until your loan closes. Your credit numbers could be altered suddenly if you purchase new furniture using credit cards. Because lenders are looking closely at your bank accounts, a large cash purchase is also not advised.

Don't go on a career search. Lending Institutions feel comfortable seeing a consistent career history on your application forms. Getting a new job before you apply for a loan may not jeopardize your approval at all. However, getting a new career during your application process could influence your approval.

Don't change banks or move cash around in your bank accounts. Your lender will require you to submit recent bank statements for your accounts: checking, savings, money market, and other assets. In order to eliminate fraud, lenders will need clear documentation of how you earn your living and where any additional wealth comes from. Changing banks or moving finances elsewhere - for whatever reason - might make it difficult for the lender to document your funds.

Don't give your FSBO (for sale by owner) seller a "good faith" deposit, delivered to his door. As a rule, your good faith deposit is yours, not the seller's up until the sale is final. Although your seller might not know this, the good faith funds should be used for the buyer's closing expenses. Find an attorney or other neutral party who will hang on to the deposit or put it in a trust account until you close. Your contract should dictate who keeps the deposit if the transaction does not go through.

Southwest Funding #841
Company NMLS # 303440 can answer questions about these "Don'ts" and many others. Call us: 5122916100.