Things to Avoid While Purchasing a New Home

With the thrill that comes with an accepted offer and a "yes" from the lender, some homebuyers make the mistake of carrying their enthusiasm straight to the mall or appliance store. Keep in mind that until your keys are in hand, your lender is watching your accounts very closely. Below you'll find a list of things to avoid 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 showplace, or celebrate your new castle, but keep away from big purchases like furniture, jewelry, appliances, or vacations until your loan closes. Using plastic to buy new living room furniture could compromise your lending process by changing your numbers dramatically. Using cash to purchase big-ticket items can even be a problem: most lenders look at your cash on hand when approving your mortgage loan.

Don't go on a job search. Your recent job history should show stability. Getting a new job may not affect your ability to qualify for a loan - particularly if you are getting a better salary. However, getting a new job during the loan process may influence whether or not you are approved.

Don't take your accounts to a new bank or move around your money. While your lender considers your loan package, you will likely be asked to produce bank statements for the last two or three months for your checking and savings accounts, money market funds and other liquid wealth. Your lending institution looks for a steady flow of your money over the month, in order to avoid fraud. Changing banks or transferring finances elsewhere - for whatever purpose - might make it difficult for the lender to verify your funds.

Don't give earnest money directly to the seller in a FSBO (for sale by owner) purchase. Until closing, any good faith deposit remains yours. Your good faith money is to be used for your expenses upon closing; some individual sellers may not understand this. You'll want to put the funds into a trust account, or get an attorney to hold them until the closing of the sale. Your purchase agreement should dictate who keeps the earnest funds if the transaction does not go through.

F&T Mortgage, Inc. NMLS # 168839 (www.nmlsconsumeraccess.org) can walk you through the pitfalls of getting a mortgage. Give us a call at 214-300-8756.