Things to Avoid While Purchasing a Home

Many new homebuyers make the mistake of rushing out to buy new things for their home as soon as the seller accepts their offer and the lender approves their loan. Until the keys are handed over, there still remain some hurdles to jump. Here are some things to refrain from during the home buying process to assure the transaction goes well.

Don't make expensive purchases. You may be itching to turn your new kitchen into a showplace, or celebrate your new dream home, but stay away from major purchases like furniture, cars, appliances, or vacations until the loan closes. Your credit numbers could be altered suddenly if you purchase new furniture using plastic. It's even a mistake to make those large purchases with cash. Lending Institutions are looking at your available cash when considering your loan.

Don't look for a new career. Lenders look for a consistent job history on your paperwork. Getting a new job before you apply for a loan may not get in the way of your approval at all. However, if you switch careers before approval, your loan process could fail or be bogged down.

Don't move cash around or change banks. Most lenders will instruct the submission of recent bank statements on accounts in your name: checking, savings, money market, and other assets. To eliminate fraud, lenders look for a clear and consistent picture of how you earn your living and where additional money comes from. Even for practical purposes, transferring money or changing banks may make it more difficult for the lender to document your bank history.

Don't give your FSBO (for sale by owner) seller a "good faith" deposit, cash in hand. Your good faith deposit does not belong to the seller: it remains yours until closing. Some sellers may not know that any good faith funds must go toward your expenses at closing. You'll need to put the funds into a trust account, or get a neutral party, like an attorney to hold them until the deal closes. If your sale falls through, the contract with the seller should indicate where your good faith deposit should go.

VSI Home Lending can answer questions about these "Don'ts" and many others. Give us a call: 2603382561.