Things to Avoid While Buying a New Home

In the rush of excitement that comes with an accepted offer and a "yes" from the lender, some homebuyers make the mistake of taking their enthusiasm straight to the mall or furniture store. There still remain a few major hurdles to jump before the house is realy yours. We have given you a list of things below you will want to stay away from when waiting for closing.

Don't empty your wallet on big-ticket items You may be itching to buy that new easy-chair for the soon-to-be-yours parlor, but it's advisable to stay away from making major buys like furniture, appliances, jewelry, or vacations until closing. Your lender may send up red flags if you purchase your electronics on your credit cards in the middle of your loan process. It's also a bad idea to make those big purchases using cash. Lenders are looking at your cash reserve when considering your loan.

Don't get a new career. Lending Institutions look for a consistent career history on your application. Finding a new job (particularly one with a bigger salary) may not change your ability to qualify for your mortgage. However, switching careers during the approval process may influence whether or not you are approved.

Don't take your accounts to a new bank or move around your cash. Bank statements from the last few months for accounts in your name (savings, checking, money market, and other accounts) will be analyzed as the lender considers your mortgage application. To eliminate potential fraud, most loans want a detailed paper trail to determine the source of all cash. Even for practical reasons, transferring cash or changing banks may make it more difficult for your lender to document your bank history.

Don't give earnest money directly to the seller in a FSBO (for sale by owner) purchase. As a rule, your earnest money is yours, not the seller's up until closing. The FSBO seller may not know that your good faith funds must be applied to your expenses upon closing. We recommend that you put the money into a trust account, or get an attorney to hold it until the closing of the sale. The final disposition of earnest funds, in the case of a failed transaction, should be written in the contract with your seller.

Foxfield Financial can walk you through the pitfalls of getting a mortgage. Call us: 7205988300.