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Major Purchases Prior To Close Are OK If Cash Is Ample; No Financing

Borrowers are usually told not to make any major purchases prior to buying a home or while they are in contract. This is b/c major purchases can either deplete necessary cash reserves or require additional borrowing or financing that might impact qualifying (the new debt might push debt ratios too high).

If a borrower has ample cash and can simply pay cash for a major purchase, it will usually not be an issue.

Similarly, if a borrower has very low debt ratios, a major financed purchase will not impact qualifying. But, a financed purchase will slow things down considerably b/c the lender will need to get all the related paperwork (note, terms, etc.) and have an underwriter review everything.

Jay Voorhees
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 01524255, NMLS# 335646