1. You Could Lose the Mortgage Rate Your Bank Quoted
Mortgage lenders will “lock in” an interest rate at the beginning of the mortgage process. This lock usually only lasts a specific number of days. Once the lock expires, the bank is free to change your quoted interest rate to whatever it is at the time – be it higher or lower than what you were originally quoted.
Many things can cause a delay in closing. From improper renovations to missing permits, your closing date could be delayed indefinitely while the issues are resolved. Don’t be surprised if something comes up that pushes your closing day back and you lose your locked-in interest rate. It’s all part of the home-buying game.
2. Don’t Assume You’re Good to Go Once You’re Approved
Many homebuyers think that once they’ve been approved for a loan, they are good to go. The reality is, many lenders will continue to check your credit, verify your employment, and double check your assets right up until the very end of the mortgage process. This means if you make any changes to your financial status – apply for a credit card, buy a car, or change jobs – it could have a negative impact on your approval for buying a home. Wait until you hold the keys to your new home before making any changes to your financial status.
3. Take Advantage of the Walk-Through
In some places, the walk-through is simply a formality, while in others, it’s a big deal. Many real estate contracts allow for a walk-through and you should definitely take advantage of it.
While most sellers will do what they have to to sell their homes quickly, others will try to get away with not doing what’s expected. A walk-through the day before closing gives you a chance to make sure everything is working properly and that the sellers have done everything they were supposed to. If you notice a major system isn’t working, or repairs haven’t been made, you can delay the closing until the issues are fixed.
4. Be Prepared to do Your Homework
In many states, it’s the seller’s responsibility to make sure any issues are resolved before closing. In some states, however, it’s the buyer’s responsibility to make sure the seller has dealt with any outstanding building permits, taken care of any issues with the local health department, assessor, or building departments, and cleared all liens from the title report. If you live in a state that puts this responsibility on you as the buyer, be prepared to do your homework and stay on top of the seller to remedy any outstanding problems with the property.
When you’ve found your dream home and are waiting for closing day, it can seem to take forever. As you wait, be sure you keep the above things in mind.