Things to avoid before buying a home

Many new homebuyers make the mistake of rushing out to buy things to fill their home with as soon as the seller accepts their purchase offer and the lender pre-approves their loan. But there are still a few major hurdles to overcome before the keys are handed to you. Here are some things to avoid during the home buying process to assure your transaction goes as smoothly as possible:

Don't make an expensive purchase. It may be tempting to order that new sofa for your soon-to-be living room, but its best to avoid making major purchases like furniture, cars

appliances, electronic equipment, jewelry, or vacations until after the closing. Financing that car could jeopardize your credit worthiness during this critical time. Using cash to purchase big items can also create a problem because many banks take into consideration your cash reserves when approving your mortgage.

Don't get a new 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 - especially since the lender will most like require at least one pay stub, and probably two, before they will close your loan.

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 for your checking, savings, 401k and retirement, as well as money market accounts. To eliminate potential fraud, most loans require a thorough paper trail to document the source of all funds. They are considered about money laundering, among other potential fraudulent practices.

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.

Don't give a good faith deposit directly to the seller in a FSBO purchase. As a rule, your good faith deposit belongs to you, not to the seller, until the deal closes. Your FSBO seller may not know that your good faith funds should be applied to your expenses at closing. Get an attorney or other neutral party who can hold the deposit or put it in a trust account until you close escrow on the home. Your purchase contract should dictate to whom the funds go should the transaction fall through.

Don't disregard your lenders requirements. Remember, your pre-approval is based on a snap shot of your income, employment, liabilities and assets as determined by the documentation you submitted to the lender at the time you applied. If any of this information changes, it may require a new approval. Be prudent and check with me before you make any changes that might materially affect your approval.