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Ten Things Home Buyers Should Avoid Doing Before Closing on a Home

Your home buying process is well underway. The seller accepted your offer to purchase. The home is officially under contract and you're counting down the days to closing. The lender pre-approved you, so buying the house is a sure thing, right?

Not so fast... Nothing is certain until the keys are in your hand and the deed is recorded. There are still bumps in the roadto get past before it's yours, and your actions between now and closing can create problems and even stop the transaction.

You've just found out your credit is A+. That's great news, because a new car would look fantastic in the driveway to match your new home. But wait--if you are depending on a mortgage to move in, you’ll be better off waiting and purchasing the car after you have been in the home for a couple of months.

If you increase your monthly debt to income ratio, then you will reduce the amount of monthly income available for your mortgage payment.

If you tack on a higher car payment, the bank might decide you can't afford the home.And believe you me, this often happens!

2. Don't Change Jobs Unless It's Necessary

Lenders 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 house is yours.

Not all sale by owner sellers don't understand that funds are not their to spend until closing. Your good faith deposit should go into a trust account.

There are many stories about sellers who spent the deposit money prior to closing. When the transactions didn't take place for valid reasons--such as repair issues or, financing the buyers had to fight for a refund.

Get an attorney or other neutral party who will hold the deposit for you until closing day and make sure your contract states what happens to the funds if the transaction doesn't close.

Stay cool during the entire home buying process, especially during and after a home inspection. Let’s be realistic, no home is perfect, especially older homes. It's not unusual for new owners to take care of some repairs themselves. Don't let the seller's refusal to do a small repair kill the deal on a home you truly love.

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 sure you can handle it emotionally and financially. Decide what type of repairs you can realistically tackle, then stick with the decision.

That sounds simple, but you'd be surprised how many people forget to apply for utility service at their new home. 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.

Don't forget to discontinue services at your old home.

This is another often-forgotten task that buyers forget 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.

It's great to be friendly, but don't get into too many long discussions with the sellers, because personality conflicts can often cloud 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 purchase it. But you'll make changes--everyone does. A casual statement about "ripping off that ugly wall paper" might make or break you.

There are some things you (and your agent) can do to correct the problem. Study your options.

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.

Know what is required of you and take care of it. For example, a Certificate of Eligibility is required to move forward on a VA loan. That's something you must take care of yourself. Answer lender questions and provide required paperwork as quickly as possible--moving into your new home depends on it.

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