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Things Not to Do
Before Purchasing a Home
No Major Purchase of Any
Kind
Review the article titled,
"Don’t Buy
a Car," and apply it to any major purchase that would create
debt of any kind. This includes furniture, appliances, electronic
equipment, jewelry, vacations, expensive weddings…
…and automobiles, of
course.
Don’t Move Money
Around
When a lender reviews your
loan package for approval, one of the things they are concerned
about is the source of funds for your down payment and closing
costs. Most likely, you will be asked to provide statements for the
last two or three months on any of your liquid assets. This includes
checking accounts, savings accounts, money market funds,
certificates of deposit, stock statements, mutual funds, and even
your company 401K and retirement accounts.
If you have been moving
money between accounts during that time, there may be large deposits
and withdrawals in some of them.
The mortgage underwriter
(the person who actually approves your loan) will probably require a
complete paper trail of all the withdrawals and deposits. You may be
required to produce cancelled checks, deposit receipts, and other
seemingly inconsequential data, which could get quite
tedious.
Perhaps you become
exasperated at your lender, but they are only doing their job
correctly. To ensure quality control and eliminate potential fraud,
it is a requirement on most loans to completely document the source
of all funds. Moving your money around, even if you are
consolidating your funds to make it "easier," could make it more
difficult for the lender to properly document.
So leave your money where
it is until you talk to a loan officer.
Oh…don’t change banks,
either.
Should You Change
Jobs?
For most people, changing
employers will not really affect your ability to qualify for a
mortgage loan, especially if you are going to be earning more
money. For some homebuyers, however, the effects of changing
jobs can be disastrous to your loan application.
>> The
Effects of Changing Jobs on Buying a Home
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