Congratulations! You’ve found a home to buy and have applied for a mortgage! You are undoubtedly excited about the opportunity to decorate your new home! But before you make any big purchases, move any money around, or make any big-time life changes, consult your loan officer. They will be able to tell you how your decision will impact your home loan.
Below is a list of 7 Things You Shouldn’t Do After Applying for a Mortgage! Some may seem obvious, but some may not!
1. Don’t change jobs or the way you are paid at your job! Your loan officer must be able to track the source and amount of your annual income. If possible, you’ll want to avoid changing from salary to commission or becoming self-employed during this time as well.
2. Don’t deposit cash into your bank accounts. Lenders need to source your money and cash is not really traceable. Before you deposit any amount of cash into your accounts, discuss the proper way to document your transactions with your loan officer.
3. Don’t make any large purchases like a new car or new furniture for your new home. New debt comes with it, including new monthly obligations. New obligations create new qualifications. People with new debt have higher debt to income ratios… higher ratios make for riskier loans… and sometimes qualified borrowers no longer qualify.
4. Don’t co-sign other loans for anyone. When you co-sign, you are obligated. As we mentioned, with that obligation comes higher ratios as well. Even if you swear you will not be the one making the payments, your lender will have to count the payment against you.
5. Don’t change bank accounts. Remember, lenders need to source and track assets. That task is significantly easier when there is consistency among your accounts. Before you even transfer money between accounts, talk to your loan officer.
6. Don’t apply for new credit. It doesn’t matter whether it’s a new credit card or a new car. When you have your credit report run by organizations in multiple financial channels (mortgage, credit card, auto, etc.), your FICO score will be affected. Lower credit scores can determine your interest rate and maybe even your eligibility for approval.
7. Don’t close any credit accounts. Many clients have erroneously believed that having less available credit makes them less risky and more likely to be approved. Wrong. A major component of your score is your length and depth of credit history (as opposed to just your payment history) and your total usage of credit as a percentage of available credit. Closing accounts has a negative impact on both those determinants of your score.
Any blip in income, assets, or credit should be reviewed and executed in a way that ensures your home loan can still be approved. The best advice is to fully disclose and discuss your plans with your loan officer before you do anything financial in nature. They are there to guide you through the process.
Author:Diana Polovko Phone: 984-833-9233 Dated: March 14th 2019 Views: 92 About Diana: Honesty, integrity, and hard work are the key elements of my business. Behind every home sale or pur...
View our latest blog posts in your RSS reader. Click here to access.
Grow Local Realty is a full service Raleigh NC Real Estate Company servicing Raleigh, Durham, Cary, Apex, Holly Springs, Clayton, Fuquay Varina, Garner, Wake Forest, Chapel Hill and all other Triangle areas including all of Wake County, Johnston County, Durham County, Orange County, Chatham County and Harnett County. We are dedicated to extraordinary customer service and are here to represent you with your next home purchase or the sale of your current home. Allow one our fantastic agents to assist you with your Raleigh NC Real Estate search.
2020 Forecast Shows Continued Home Price AppreciationQuestions continu
"Wayne Hoose of Grow Local Realty
Wayne was terrific! He was always early (punctual), always very responsive to email, texts and phone messages. He was proactive and anticipated my needs. We had an unusual situation that made Wayne have to spend extra time doing things that are not normally a part of a residential real estate deal ( I was hoping to start a business which involved zoning and permits and such). Wayne went above and beyond the call of duty to answer questions that I had and did a great job for me!"