In my many years of real estate, I have witnessed many “close calls” as buyers unknowingly did certain things that changed their financial position when buying a new home. While this may be okay in some instances, it can create additional work for the buyer’s lender to be sure that they are still qualified to purchase the home they have chosen. Other times, it is just not okay and can jeopardize their loan.
Do not make any large purchases when buying a new home.
This seems to be a given but if you are under contract and considering purchasing that new refrigerator, especially financing it, ask your lender if this is acceptable prior to making that decision. Avoid purchasing automobiles, boats or other large purchases.
Do not open any lines of credit before purchasing your next home.
This includes credit cards or equity lines on your current home if you are buying a property prior to selling your existing home. Do not increase your credit limits on any of your credit cards. And definitely talk to your lender before choosing to open any additional credit lines.
Do not change your job.
There may be some situations that are acceptable, such as accepting a promotion within your same company. Most lenders will need extensive documentation from your employer and some companies have a probationary period that lenders expect to be completed prior to granting a loan. If you are considering purchasing a home and are not yet under contract, a potential job change would be a helpful conversation to have with your lender prior to your house search. Lenders will verify that you are still employed with the same employer under the same terms right before you close on your new property.
Do not make any substantial deposits or withdrawals from your bank accounts.
Lending institutions must be able to verify where you receive the funds that you deposit. The funds currently in your bank accounts may be the money your lender used to qualify you to purchase a new home. These are the funds they expect you to use for your down payment and closing costs. Be careful when moving around or withdrawing those funds.
Other important things to keep in mind when purchasing a new home is to avoid making late payments, do not cosign a loan with anyone and do not ignore questions from your lender or financial institution.
If you are unsure about a particular item that you intend to do, contact your lender prior to making any changes, just to be sure it will not adversely affect your financial situation. And by all means, secure your real estate agent and your lender while you are in the planning process of purchasing your next home.
For more information, read the following article:
I can help you understand the homebuying process. Feel free to contact me with any questions and to help you get started.