Do-Nots before Buying or Closing on a Home

Do Not: Make Major Purchase of Any Kind

Any major purchase that would create debt of any kind, such as buying a car, furniture, appliances, electronic equipment, jewelry, vacations, or expensive weddings.

Do Not: Move any Money Around accounts

Lenders review loan packages for approval, and one thing they are concerned with is your source of funds for your down-payment and closing costs. You will be asked to provide statements for at least the last two or three months, which includes checking accounts, savings accounts, CD’s, mutual funds, etc.

If you have been moving money around, the mortgage underwriters will likely require a reconciliation of the paper trail of all withdrawals and deposits. They may also require you to produce cancelled checks, receipts, and other minor information that can become time-consuming.

They are not trying to make your life harder, they are only doing their jobs to ensure quality control and eliminate possible fraud – most underwriters must document the source of all funds. So, moving your money around, even if you believe consolidating your funds makes it easier, could make it more difficult for the lender to properly track and document your withdrawals and receipts.

Take to your mortgage lender and ask what they recommend before purchasing anything or moving money around. They will likely tell you the same thing.

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