If you are in the market to buy a Fountain Hills home, getting pre-approved for a mortgage is one of the first steps to take. However, a pre-approval doesn’t guarantee that you will ultimately get the financing if you have any change in your circumstances between the pre-approval application date and your loan closing.
It is almost unbelievable what some people will do after they get their loan approval that could actually kill their financing and their approved mortgage. I once sold a home to a couple buying their first home and during the time they were waiting for a loan approval the husband quit his job. I guess he figured his wife had income but both incomes were needed to qualify for the loan. With that move it isn’t surprising he was denied the loan. Most times lenders will pull your credit the day before they fund the loan just to be sure you made no major purchases. Also you may be asked to produce a current paystub.
Here are 3 major Fountain Hills home buying mistakes to avoid.
1: Making credit purchases after loan application, prior to closing.
This one seems to be a no-brainer, but it happens. Whatever you do, do not apply for any new credit between your loan application date and your closing. The new credit line could affect your credit score or debt-to-income ratio, or both, and could potentially lead to a mortgage denial. If you must make a purchase, talk to your mortgage lender first. In most cases, those purchases need to wait until after you close on your home.
2: Larger than $500 non-payroll deposits into your bank account
This is the most common home buying mistake out there. Any non-payroll deposits into your bank account within 60 days of closing must be “sourced.” In other words, you need to show where it came from and that it was your money. This is most commonly a problem with people who have “mattress money” or cash they intend to use toward their home purchase. Cash can’t be used unless you deposit it into your account more than 60 days prior to closing. If you have any funds to deposit, do it before your pre-approval application and if after, inform your lender.
3: Changing jobs
Sometimes changing jobs is necessary. However, if you intend to change jobs, or worse yet, you lose your job after you have been pre-approved, inform your lender immediately. If you want to make a job change, the best policy is to wait until after your closing. However, a change within the same field is usually ok with an increase in pay and an explanation as to why the change was made. If you get a job offer that is too good to pass up, by all means take it, but discuss with your lender first. If you lose your job, and are able to find work in the same line of work within 30 days, you should still be approved for your financing.
Hopefully these tips will help you avoid some of the most common home buying mistakes. For quick answers to your questions you can contact me at 480 888 6708 or email me regarding Fountain Hills, neighborhoods, price trends, short sales, etc. I’ll get back to you ASAP!