Sunday, January 11, 2009
Your home buying process is on the way.Looks like the sellers accepted your offer to purchase. The home is officially under contract ,The lender pre-approved you and you are waiting to move into your new house?Nothing is 100% certain until everything is settled.A wrong move could slow down or stop the transaction or could even spoil your whole plan.
1. Don't make any major purchase
You bought a new house.Thinking of getting a brand new car which fit your new house too?Its not advisible to do so if you are depending on a mortage for the house.
An increase in your debt to income ratio reduces the amount of monthly income available for your mortgage payment.
Even Using cash to purchase the car might not help, since banks consider cash reserves when approving your mortgage.Talk to your loan officer if buying the car is a must.
2. Don't Change Jobs Unless It's Necessary
A consistent job history is better than a nonconsistent one.It might not affect much if you change jobs within the same field, but it's better to stay put until the house is yours.
3. Don't Give an Earnest Money Deposit Directly to a For Sale By Owner Seller
Your good faith deposit should go into a trust account. Some for sale by owner sellers don't understand that funds are not their to spend until closing.
I've heard many stories about sellers who spent the deposit money prior to closing. When the transactions didn't take place for valid reasons--such as financing or repair issues, the buyers had to fight for a refund.
Find an attorney or other neutral party who will hold the deposit for you until closing day and make sure your contract dictates what happens to the funds if the transaction doesn't close.
4. Don't Let Your Emotions control you
Calm down and have a clear mind during the entire home buying process, especially during and after a home inspection. Be realistic.If you are buying an older home,some repairs are required to be done by seller but dont because of a little refusal from seller affected your decision of buying the house.
Never fall so much in love with the house that you'll do anything to own that lovely house--unless you're sure you can handle it emotionally and financially. Decide what type of repairs you can realistically tackle, then stick with the decision.
5. Don't Forget to Switch Utilities (electricity / water)
Its a simple one but also an often forgetted one,but you'd be surprised how many people forget to apply for utility service at their new home ended up staying in a house without water and electricity.Call the utility companies as soon as you have a contract. Find out how many days lead time they need to switch the service, then get back with them when you have a firm closing date.
After that,discontinue the services at your old home.
6. Don't Forget to Line Up Your Hazard Insurance
it's another often-forgotten task that buyers scramble to take care of at the last minute. Before closing, your lender will want to see an insurance binder showing you have coverage for the new home. Get it as early as possible so that closing isn't delayed.
In some locations, additional types of insurance coverage might be necessary. Talk to your lender about insurance requirements well before the closing date.
7. Don't Become buddies with the Seller
It's great to be friendly.Be clear that your role is a buyer and he is a seller.Don't get into too many long discussions with the sellers as personality conflicts often cause judgments.
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 about repairs or other issues that crop up.
8. Don't Panic if the Appraisal Comes in Low
At least not at first. There are some things you (and your agent) can do to correct the problem. Study your options.
9. Don't Go It Alone
If you're working with an agent, it's the agent's duty to track many of the day to day details that involve the lender, the seller, or the seller's agent. Be sure your agent schedules a final walkthrough just before closing.
10. Don't Ignore Lender 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. Answer lender questions and provide required paperwork as quickly as possible--moving into your new home depends on it.