Purchasing a Home Soon? Here are 5 Things NOT to do…
Unless you’re planning on plunking down a load of cash on your new home, you’re going to need to get a mortgage. Even after you’ve been pre-approved for your mortgage and the purchase is under contract, the deal isn’t closed until it’s closed. Wait until you have the KEYS in hand before doing any of the following things to prevent any problems from arising that may ruin your deal.
Don’t make large purchases. It’s common to want to run out and purchase new furniture and appliances for your home once your offer is accepted. Wait, are you going to put all that on your credit card? Uh-oh. You just changed your debt to income ratio which means you may no longer qualify for that home loan.
Don’t change jobs. The bank would prefer to see consistency in your employment. If you must change jobs, make sure you’re getting much better pay at the new one.
Do NOT become self-employed. Banks want to see a 2-year track record of your income when self-employed. If you must be your own boss, wait until after closing.
Don’t move your money around. That is, unless you like having to provide a complete paper trail of all of your transactions, including cancelled checks and deposit slips, to prove you will have the necessary funds to cover your down-payment and closing costs.
Don’t give earnest money directly to a For Sale By Owner. If you’re dealing with a For Sale By Owner you may not have the luxury of an agent to handle your earnest money deposit. Sadly, if you give this money directly to a home-seller, they may spend it before closing. If the transaction never occurs you may be in for a long fight to get your money back. Therefore it’s safer in a trust account. Seek the advice of a real estate attorney to handle your deposit.
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