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The period between submitting a mortgage application and actually getting the keys can be interminable. Read on for your to-do (and to-don’t) list. [[{“value”:”
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Tom Petty was right — the waiting really is the hardest part. There are many steps to the process of becoming a homeowner, and easily the most boring is waiting for your mortgage to close.
You’ve put in the work of getting your finances into good shape, saving money, picking a real estate agent, house hunting, and making an offer — and now you’ve got to sit around and wait until the day you show up at an office and sign at least a tree’s worth of paperwork and get the keys to your new home.
While you’re waiting (and underwriters are doing their work), there are a few moves you should make — and one you absolutely shouldn’t. Keep reading to learn how to productively pass the time.
Three dos
Focus on these moves for success, and to use up some of that nervous energy you’ve got.
1. Declutter
If you’ve been living in your current place for a while, you’ve likely got drawers and closets full of junk you may not need in your new home. I’ve moved 35 times in my life, and in most cases, I didn’t really have the time to significantly declutter my life beforehand.
Now that I’m waiting to close on a house, I’m excited at the prospect of being able to move with only the items I need. I spent some time over the winter holidays cleaning out my closets and finding items to donate and throw away, and I plan to do more of this as I start packing to move, too. Do yourself a favor and don’t just shove everything into boxes without considering whether you’ll actually need everything in your new home. After all, less to move means saving time and perhaps money in the process.
2. Make a moving plan
Speaking of moving, now is a great time to strategize. Consider all your options for how to pull it off — if you’ve bought a home in another state, you likely won’t have much choice beyond loading a big truck or cargo moving container, but if it’s an in-town move, you could have the gift of time. Personally, I’m planning to move some of my more light, small, and fragile belongings in over a few weeks using my own vehicle, then hire movers with a truck to tackle getting the furniture and big stuff out of my second-floor apartment and into my new house.
Don’t forget to price out the cost of the move itself, including related supplies and services — movers, for example, and boxes, tape, bubble wrap, and perhaps a pet sitter or babysitter for the day of. (Moving is scary and confusing for pets and kids, so keep their comfort and safety in mind.) And pad your moving budget by $500 more than you think you’ll need — it’s always more expensive than you expect.
3. Keep saving
If you’re anything like me, you’ve gotten in the habit of chucking money into a savings account along the way to becoming a homeowner. This was a smart move — buying a house is expensive, and while a down payment and closing costs are likely to be the most expensive part of that process, your costs don’t stop there.
Once the house is in your name, you’ll be taking on the great unknown of maintenance and home repairs, on top of your mortgage payments, property taxes, homeowners insurance, and potentially other ongoing bills (like homeowners association fees, if they apply to you). So the period between application and closing is a great time to just keep plugging away at padding your savings account. An emergency fund is even more crucial when you’re a homeowner.
One big don’t
I’ll cut right to the chase here. Do not, under any circumstances, make any changes to your financial or credit situation. You might already have a list of, say, furniture items you want to buy for your new home (I know I do). But don’t proceed with those purchases before your loan has closed. Don’t open a new credit card to make the purchases, either. And definitely don’t change jobs if you can avoid it.
Your mortgage lender will be checking up on your financial situation ahead of closing, and if it sees that there’s been a change like that, you may lose out on the mortgage. You won’t be able to buy that house you’re dreaming about. Just cool your jets until after you’ve been through closing, signed your life away, and have the keys in hand. Then you can move forward with a big purchase, applying for a new 0% APR credit card to help you tackle unplanned repairs without interest costs, or other potential changes to your financial picture.
Waiting for a loan to close is a boring time — you might start to get antsy. Use that energy for good, and plan for your move, get rid of junk you no longer need, and keep padding your emergency fund. Leave the credit card application or big purchases for after closing.
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