When is it safe (during buying process)?

We recently made an offer on a house, have signed the contract from our side and given the $ for escrow, and sellers are counter signing today.

Our loan application is in process as of yesterday, and we already have received pre-qualification/approval.

Is it safe for us to start looking for furniture, etc? Or could things still go the opposite direction?

Re: When is it safe (during buying process)?

If you want to be 100% safe, I'd wait until closing!

In reality, most of the time, once a house goes into full contract, it closes (unless it's a short sale, which is a different animal requiring other steps and the involvement of the bank).

If a traditional sale goes into full contract (meaning BOTH the buyer and seller sign), then it will most likely close. So I want to reassure you first, before laying out what "could" happen but probably won't.

The main reason sales that are "under contract" fail to close is that the buyer cannot obtain financing.

Your loan still needs to be processed and then reviewed/approved by an underwriter, so you can get an actual loan commitment. The underwriters are really the ones who have all the authority for the lender -- depending on the lender, sometimes they are the LAST ones to see the loan application, which makes no sense. The preapproval doesn't carry all that much weight - it's only as good as the loan officer who issued it. If you have someone thorough and knowledgeable, then there should be no issues. But I've seen loan officers for lenders (and mortgage brokers, who place loans with banks) make mistakes upfront that cause problems down the road in the process. And I am sure it goes without saying that you should keep everything financially status quo until you get the loan (don't switch jobs, buy a new car, even open a new credit card!).

In order to get financing, the house has to appraise for the contract price (or you have to come to the table with more cash or the seller has to agree to take less money, or a combination of both has to happen.

And even if you have the commitment and the appraisal comes in, sometimes the bank imposes conditions to be met before they will give the "clear to close."

The seller must also be able to give you clear title, in order for you to close. So sometimes, when a buyer's attorney runs title (hopefully early on, once you are in contract), issues crop up that need to be dealt with before closing. Most times, these are things that may delay the closing (C/Os need to be obtained) but not prevent it entirely.

But I had a closing with buyer customers a few months ago that almost didn't happen because the seller, despite having ample equity in the house to pay off the mortgage and walk away with a profit (we thought), didn't disclose or know that there were numerous liens against the property (from upaid taxes, repossessed cars, etc.). He couldn't afford to pay off all the liens from the proceeds, and somehow his attorney didn't know this ahead of time, so we almost couldn't close. With some creative problem solving, we did close, and that was totally a fluke scenario, but strange things can happen!

When is it safe (during buying process)?

WAIT!! These things can take time and you'd be surprised at how many things can delay a closing.

We did not look at furniture until after we closed. I did not want to buy anything and then have to wait for delivery. Most places will be able to deliver pretty quickly.

When is it safe (during buying process)?

I have to agree...definitely wait.

That's not to say your deal is going to fall through but the other posters are right. You wouldn't believe the things that could delay a closing! I'm living this right now.

Re: When is it safe (during buying process)?

look but don't buy!

Alot of things can delay a closing, plus after really being "in" the house you may change your mind on type/style.

Good luck!

Re: When is it safe (during buying process)?

Re: When is it safe (during buying process)?

Thanks ladies! The only thing I decided to buy was a cast iron pot...It was 75% off - I figure that's okay Not going to buy anything else until after we close. It's taking a lottt of willpower hah

Re: When is it safe (during buying process)?

Look but don't buy.

Re: When is it safe (during buying process)?

Re: When is it safe (during buying process)?

I would Look but don't buy anything yet, and don't open any accounts with the furniture places till after u close!

Re: When is it safe (during buying process)?

And what you think you want now might change once you have lived in the house for a little while. As long as you have a mattress to sleep on hold off until you lived there at least a little bit.