More than 1.4 million home buyers have taken advantage of the $8000 first time buyers' credit, but with the deadline on the credit looming, plenty of buyers are under contract and looking to close before Nov. 30.
Excited to be moving into a new home, some of these first-timers are hitting the stores shopping for new furniture and appliances.
This is a big mistake....Wait until the close to start buying stuff.
The reason is that lenders are often running credit reports right up to the closing day, and they don't want to to see an increase in credit card debt or indications that debt could soon increase.
Even serious looking can be a problem. Checking out a new car or boat can show as an inquiry on a credit report and might raise red flags. This is especially important for buyers who've only met the lender’s minimum requirements.
While such measures have been used over the years, lenders are still dealing with the fallout from their previous lax lending standards, and are being especially particular these days. Even buyers with great credit scores face scrutiny.
We're also advising buyers not to move money between accounts or add more funding to checking. Emptying out an account could look like money’s being spent.
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