Things to avoid before and during the "buying a home" stage.
Many
new homebuyers make the mistake of rushing out to buy things to fill their
home with as soon as the seller accepts their purchase offer and the lender
pre-approves their loan. But there are still a few major hurdles to overcome
before the keys are handed out. Here are some things to avoid during the home
buying process to assure your transaction goes as smoothly as possible:
Don't make an expensive purchase. It may be tempting to order that new sofa
for your soon-to-be living room, but it is best to avoid making major
purchases like furniture, cars, appliances, electronic equipment, jewelry, or
vacations until after the closing. Financing that furniture with a store
credit card or even one of your own credit cards could jeopardize your credit
worthiness during the time it means the most. Using cash to purchase big
items can also create a problem because many banks take into consideration
your cash reserve when approving your mortgage.
Don't get change jobs or reduce your income in any way. Lenders like to see a
consistent job history. Generally, changing jobs will not affect your ability
to qualify for a mortgage loan - especially if you are going to be making
more money and staying within the same field of employment. But for some
people, getting a new job during the loan approval process could raise some
concern and affect your application, preventing the loan entirely.
Better safe than sorry.
Don't switch banks or move money around. As your lender reviews your loan
package, you will likely be asked to provide bank statements for the last two
or three months on your checking accounts, savings accounts, money market
funds and other liquid assets. To eliminate potential fraud, most loans
require a thorough paper trail to document the source of all funds. Changing
banks or transferring money to another account - even if its just to
consolidate funds - could make it difficult for the lender to document your
funds. The lender requires ALL pages of every asset account
Don't give a good faith deposit directly to the seller in a FSBO purchase. As
a rule, your good faith deposit belongs to you, not to the seller, until the
deal closes. Your FSBO seller may not know that your good faith funds should
be applied to your expenses at closing. Get an attorney or other neutral
party who can hold the deposit or put it in a trust account until you close
on the home. Your purchase contract should dictate to whom the funds go
should the transaction fall through. We recommend having a RE attorney
review any contracts
call us up we have built relationships with
several who provide this service at no charge when you use them for your
closing.
Don't disregard your lenders requirements. You may have been
pre-approved for the loan but your work with the lender is far from
over. In order to process your loan, you need to meet certain
requirements. Your lender will need certain items in a timely and
efficient manner. It is up to you to get it to him or her as soon
as possible. Failure to submit certain qualifying documents could
cause you to lose your loan and the financing you need to buy
your home.
The Do's:
Do make all of your payments on time, especially your Mortgage and/or Rent
payment. Failure to make payments on time may result in higher interest
rates or in some cases disqualify you from obtaining the loan.
Do call your team of mortgage professionals with any questions or concerns
you have.
Do obtain a cashier's check or certified funds prior to closing for the
amount needed at closing. No cash or personal checks will be
accepted. Review your Settlement Statement with your mortgage
professional prior to closing. Some time lines are very tight to meet
contract deadlines your cooperation is very important.
Do
trust your lending team and have patience. We realize that
obtaining a mortgage is very time consuming and can be nerve
racking. This process requires patience and cooperation.
Remember that our all consuming goal is to provide you with a mortgage!
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