+ 1. Don't make another purchase
You've
just found out your credit is A+. So you've decided
a new car would look fantastic in the driveway
of your new home. If you're paying cash for the
home go right ahead. But if you are depending
on a mortgage to move in you'd best wait until
after closing.
An
increase in your debt/income ratio reduces the
amount of monthly income available for your
mortgage payment. The bank may decide you cannot
afford the home.
Using
cash for a purchase can be a problem too, since
banks consider cash reserves when approving
a loan.
If
you must make a major purchase before closing,
talk to your loan officer before you do it.
+ 2. Don't Change Jobs.
Banks
like to see a consistent job history. They aren't
usually as nervous if you change jobs within the
same field, but it's better to stay put until
the keys to the house are in your hand.
+ 3. Don't Give an Earnest Money Deposit
Directly to a FSBO Seller.
It
should go into a trust account. Some FSBO sellers
don't understand that funds are a good faith deposit
to be applied to your expenses at closing. I've
heard many stories about sellers who spent the
buyer's money prior to closing. When the transactions
didn't take place for valid reasons--such as financing
or repair problems, the buyers had to fight to
retrieve their funds. Find an attorney who will
hold the deposit for you until closing day.
+ 4. Don't Let Your Emotions Take Over
There
are many areas where that statement applies,
but one of the most important involves the home
inspection. Be realistic. No home is perfect,
especially older homes. Don't let the seller's
refusal to do a small repair kill the deal on
a home you truly love. It's not at all unusual
for new owners to take care of some things themselves.
On the other hand, don't fall so much in love
with the house that you'll buy it no matter
what needs to be done (unless you're absolutely
sure you can handle it emotionally and financially).
Decide what type of repairs you can realistically
handle, then stick with the decision.
+ 5. Don't Forget to Switch Utilities.
That
sounds simple, but you'd be surprised how many
people forget to apply for utility service at
their new home. Call the companies involved as
soon as you have a contract. Find out how many
days lead time they need to turn on the new service,
then get back with them when you have a firm closing
date.
+ 6. Don't Forget About Hazard Insurance.
A
no-brainer, right? But it's another often-forgotten
task that buyers scramble to take care of at the
last minute. Your lender will require an insurance
binder for the new home at or prior to closing.
Take care of it right away.
+ 7. Don't Become Best Friends with the
Seller
I'll
get some flack on this one. It's great to be friendly,
but don't get into too many long discussions with
the sellers because personality conflicts often
cloud judgments. I've had selling clients refuse
to make even small repairs because something about
the buyers turned them off.
And
remember, this is their home. You're no doubt
excited about moving in, and if you didn't like
the house you wouldn't have offered to buy it.
But you'll make changes--everyone does. A casual
statement about "ripping up that ugly carpet"
might be hurtful enough to keep the seller from
negotiating with you for needed repairs.
Keep
it to yourself.
+ 9. Don't Go It Alone.
This
is why you should be using a Realtor to represent
you. It's your agent's duty to help you make it
to closing..
+ 10. Don't Ignore the Requirements
Know
what is expected of you and take care of it. For
instance, a Certificate of Eligibility is required
to move forward on a VA loan. That's something
you must handle yourself. If the lender asks you
for something, get it to them immediately.
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