Things to Avoid While Purchasing a New Home

Some new homebuyers make the mistake of rushing out to buy things to fill their home as soon as the seller accepts their offer and the loan is approved. Until the keys are handed over, there are still some hurdles to jump. We have given you a list of things below you will want to avoid when waiting for your loan to close.

Don't throw your money around. Although you may be planning ways to turn your new house into a castle, avoid big ticket purchases like appliances, electronics, or expensive furnishings. We also recommend that you avoid vacations and vehicle purchases until your loan closes. Your credit numbers could change suddenly if you make a huge purchase using plastic. Because lenders are perusing your bank accounts, a large cash purchase is also a bad idea.

Don't look for a new job. Consistency in your career history is a positive thing to banks and other lenders. Getting a new job before you start the application process for a mortgage loan may not jeopardize your approval at all. However, if you switch careers before you qualify, your process could fail or be stalled.

Don't take your accounts to a new bank or move around your cash. Your lending institution will ask for recent bank statements on your accounts: savings, checking, money market, and other liquid assets. In order to detect fraud, lenders want to see clear documentation of how you earn your money and where additional money comes from. Switching banks or transferring funds to another account - even if its merely to consolidate funds - might hinder the documentation of your accounts.

Don't give your FSBO (for sale by owner) seller earnest money, cash in hand. Your good faith deposit does not belong to the seller: it remains yours until the transaction is final. Any earnest money is to be applied to your expenses closing; your FSBO seller may not know this. We recommend that you put the money into a trust account, or get a neutral party, like a lawyer, to hold it until closing. If your sale falls through, the contract with the seller should dictate where this good faith deposit should go.

Norcal Capital Group, Inc can walk you through the pitfalls of getting a mortgage. Call us at 6507631924.