Avoid These Mistakes When Closing a Home

How to Ensure a Smooth Closing Process

Obtaining approval for a home loan is an important milestone in purchasing a home. However, it is not the final step in the process. A home purchase does not become official until the appropriate paperwork has been signed by the buyer and the seller. Let’s look at some issues that could result in a closing being delayed or scrapped completely.

You Spend a Lot of Money

A mortgage lender will approve a home loan based partially on your debt-to-income ratio. If you spend money on furniture, appliances or other goods, it could cause that percentage to jump. In some cases, it could go high enough that a lender no longer feels comfortable making a loan. Therefore, you should hold off on any large expenditures until after the sale has closed.

You Decide to Quit Your Job

The financial institution that approves your loan will do so under the assumption that you have steady employment. While you may have sufficient assets or savings to make your mortgage payment for years to come, a lender still wants to see that you have money coming in to repay the debt. If you are planning on quitting your job or otherwise changing your employment status, the period between loan approval and closing is not an ideal time to do so. Again, it may be best to start a business or take a sabbatical after closing. (Get informed on the new tax laws and your mortgage here.)

Your Loan Officer Can Provide a List of Dos and Don’ts

The best loan officers Las Vegas will likely provide you with a list of things not to do after receiving loan approval. You can also learn more about how to avoid losing a home online or by talking to others who have gone through the home buying process before.