Things to Avoid While Buying Your Home

Many borrowers make the mistake of rushing out to buy things. But there are still a few major hurdles to overcome before your refinance is completed. Here are some things to avoid once your loan has been approved to assure your transaction goes as smoothly as possible:

Don't make an expensive purchase and don't apply for any new credit. It may be tempting, but it is best to avoid making major purchases (like furniture, cars, appliances, electronic equipment, jewelry, or vacations), or applying for additional credit until after the closing. Financing that furniture with a store credit card or even one of your own credit cards could jeopardize your credit worthiness during the time it means the most. Using cash to purchase big items can also create a problem because many banks take into consideration your cash reserve when approving your mortgage.

Don't change careers (and if possible, stay in your current job). Lenders like to see a consistent job history. Generally, changing jobs will not affect your ability to qualify for a mortgage loan - especially if you are going to be making more money. But for some people, getting a new job during the loan approval process could raise some concern and affect your application.

Don't switch banks or move money around. As your lender reviews your loan package, you will likely be asked to provide bank statements for the last two or three months on your checking accounts, savings accounts, money market funds and other liquid assets. To eliminate potential fraud, most loans require a thorough paper trail to document the source of all funds. Changing banks or transferring money to another account - even if its just to consolidate funds - could make it difficult for the lender to document your funds.

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