We got the clear to close last week (!!!) and don’t actually close until Jan 16. Wondering if it’s ok to make a large payment during this period?
We have to pay $15k in taxes as we had to amend the last three years’ returns due to an incompetent tax preparer. We have the money in our savings, but I’m afraid a payment this large will trigger something with Zillow home loans.
I could, of course, ask our lender/underwriter but she has been so unhelpful and seems to be out of office (so glad we already got cleared to close!). So, does anyone know if the clear to close generally means I can make a large “purchase” without red flags?
Thank you u/Dzabyss666 for posting on r/FirstTimeHomeBuyer.
Please keep our subreddit rules in mind. 1. Be nice 2. No selling or promotion 3. No posts by industry professionals 4. No troll posts 5. No memes 6. "Got the keys" posts must use the designated title format and add the "got the keys" flair.
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.
I'm surprised the mortgage company did not require proof that the payment of taxes was made prior to issuing their clear to close.
you saw who the provider of the loan was?
We actually were too but we were getting the amendments filed at the same time as the lending process so maybe it didn’t flag? Who knows!
It definitely didn't flag. And if they do notice it before closing, they're going to ask you for that proof before reissuing your clear to close. If they notice it after your closing, you're going to be asked for additional documentation, and it might be an issue.
Interesting! I’ll have all the proof, and we were able to square up with the IRS today via a separate account
As a former mortgage coordinator, I would not suggest making any large expenditures until AFTER your actual closing date. Congrats on the house! (Edit to fix typo)
That’s what I was afraid of, thank you!! Better safe than sorry
I'm a tax guy, worst thing that happens is you just pay slightly more interest on the tax debt by waiting. Not really a big deal
Good point!!
I'm a tax guy, worst thing that happens is you just pay slightly more interest on the tax debt by waiting. Not really a big deal
No. You are only cleared to close based on your financial situation at that time. If you change that situation, your clearance goes away. Wait until after closing.
Thank you!
Our lender told us under NO circumstances to make a large purchase, spend a large amount of money or open any new credit until after the closing documents were signed. If I remember correctly, even after the "clear to close" they will run your credit and check your employment again one more time...generally a day or two before closing.
They wouldn't repull credit after clear to close, if something bad was on it they'd want to know whats going on before issuing CTC, but you are correct on verifying employment, although it's only a verbal (no income information gathered)
Thank you for clarifying. We are about 1.5 years out and it was a whirlwind. I know you aren't supposed to do anything crazy until the docs are signed. I am so glad that this is our 1st and forever home.
You'll go through a similar process if/when you ever refinance, although none of the agent/inspection bologna :) much, much less stressful!
🤣🤣 Plot twist for me. I am clearly not thinking clearly today and should probably just stop talking. Yes....we plan to refinance in 2027.
I would talk to your LO or find a new one. That’s an undisclosed debt, that will show up if they pull tax transcripts. You should settle this up asap, how was the rate? I find ZHL being not great on pricing for sub par service.
Service has been iffy so far but I pit 4 lenders against each other and Zillow came back with an offer that couldn’t be beat by anyone else (after a few rounds of offer beating back and forth). The rate is 5.875 which we are happy with—no buy down and lots of lender credits as well! But the underwriter has been a pain for sure Luckily was able to get the taxes paid today via a bank account not included with our lending process (that we really didn’t want to use, but can shore back up in two weeks oh well)
We had to amend our taxes to get our loan and we had to show proof we handed them to irs to file as well as proof it was paid. But they didn’t want it out of our accounts that had the down payment in…. So we had to have my mom “gift” us the money, do a paper showing that she gave us a gift, show her monthly bank statement with where the money came from and then pay it from that and we were NOT allowed to pay her back until after close. It was a mess!! Not sure if this is similar at all to your issue but worth asking someone else at the office because showing proof of it being filed, paid, etc can be a hassle and almost held up our close date (which was actually held up due to other reasons later 🙄)
Ugh!!! So annoying!! Super similar but luckily we had an account excluded from our closing costs/quals that we could use to pay the taxes. Not ideal to use this account, but doable for the time being