You've been pre-approved for a purchase loan and you are in escrow to buy your dream home. Just because contingencies have been met and closing day is just around the corner, there are a few things that can still put your transaction at risk.
Read on to to learn what actions to avoid during the home buying period:
1. Don't make ANY large purchases:
A major purchase that requires a withdrawal from your verified funds or increases your debt to income ratio can result in you no longer qualifying for the loan. A lender will check your credit and re-verify funds just before finalizing your loan, so avoid purchases that could impact your loan approval. These items include the following:
-Purchasing, leasing, or co-signing for a new vehicle.
-Purchasing furniture or appliances for your new home, whether you buy with cash or credit.
2. Don't change Jobs:
A job change may result in your loan being denied, particularly if you are taking a lower paying position or moving into a different field. Don't think you're safe because you've received approval earlier in the process, as the lender may call your employer to re-verify your employment just prior to funding the loan.
3. Don't pay off existing accounts unless your lender requests it:
If your loan officer advises you to pay off certain bills in order to qualify for the loan, follow that advise. Otherwise, leave your accounts as they are until after your escrow closes. But DON'T forget to continue to make your monthly payments!
4. Don't switch banks or move your money to another institution:
After the lender has verified your funds at one or more institutions, the money should remain there until needed for the purchase.
5. Don't change Your Marital Status:
How you hold title is affected by your marital status. Be sure to make both your lender and the title company aware of changes in your marital status so that documents can be prepared correctly.
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