Things to Avoid While Buying a New Home

Some new homebuyers make the mistake of rushing out to buy things to fill their home as soon as the seller says "yes" and the lender approves their loan. Until closing, there are still some hoops to jump through. Here are some actions to stay clear of during the home buying process to be sure the transaction goes well.

Don't buy big-ticket items. Although you will be dreaming of ways to turn your new home into a showplace, try to stay away from big ticket purchases like appliances, electronics, or expensive furnishings. We also recommend that you avoid vacations and vehicle purchases until the closing of your loan. Financing new furniture with a store card or a bank credit card could put your credit worthiness at risk during the time it means the most. Because lending institutions are looking closely at your financial accounts, a large cash purchase is also not advised.

Don't look for a new career. Your recent career history should show stability. Finding a new career (especially one with a bigger salary) may not hinder your ability to qualify for a loan. However, switching jobs during your loan process may affect your approval.

Don't switch banks or move money around in your accounts. Bank statements from the last two or three months for all of your accounts (savings, checking, money market, and other assets) will probably be analyzed as the lender considers your application. To detect fraud, lenders will need clear documentation of how you earn your money and where any additional money comes from. Even for practical purposes, moving around cash or switching banks could make it more difficult for your lending institution to document your bank history.

Don't give your FSBO (for sale by owner) seller earnest money, cash in hand. Until the sale is complete, any good faith deposit actually belongs to you. Some FSBO sellers may not realize that your good faith funds should go toward your expenses at closing. An attorney or other type of neutral party can hang onto your earnest money, or you may put it temporarily into a trust account until closing. The disposition of good faith money, in the case of a failed transaction, should be documented in the purchase agreement with the seller.

Omni Mortgage Corp. can walk you through the pitfalls of getting a mortgage. Give us a call at 7184417000.

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118-18 101st Avenue
Richmond Hill, NY 11419