Don't Trip Yourself up While Buying a New Home

In the rush of excitement that comes with an accepted offer and a "yes" from the lender, many homebuyers make the mistake of carrying their enthusiasm straight to the mall or furniture store. Until your keys are in hand, there are still some hoops to jump through. Below you'll find a list of actions to stay away from during this crucial time of your home purchase.

Don't empty your wallet on big-ticket items You may be itching to turn your new living room into a home magazine cover, or celebrate your new castle, but keep away from major purchases like furniture, cars, appliances, or vacations until closing. Your lender may send up red flags if you finance your furniture on your credit cards in the middle of your loan process. Since lenders are reviewing your financial accounts, a large cash purchase is also not advised.

Don't look for a new career. Consistency in your job history is a positive thing to banks and other lenders. Changing jobs may not compromise your ability to qualify for a loan - especially if you are going to be making more money. But for some, changing jobs during the mortgage loan approval process might bring concern and hinder your approval.

Don't switch banks or move finances around in your accounts. As your lending institution considers your mortgage application, you will likely be required to produce bank statements for the last two or three months for your checking accounts, savings accounts, money market accounts and other liquid finances. The lender will need to see a steady flow of your money each pay period, in order to avoid fraud. Even for innocent reasons, transferring funds or changing banks might make it more difficult for the lending institution to verify your account history.

Don't give your FSBO (for sale by owner) seller a "good faith" deposit, delivered to his door. As a rule, your good faith money is yours, not the seller's until the sale is final. Your earnest funds are to go toward your expenses upon closing; some sellers may not realize this. You'll want to put the deposit into a trust account, or get an attorney to hold it until closing. Should your sale fall through, your purchase agreement should specify to whom your earnest money should go.

Metro Mortgage can walk you through the pitfalls of getting a mortgage. Give us a call at 866-300-1550.