Top 10 Mortgage Mistakes to Avoid!
Do you want a successful, timely closing? Mortgage mistakes can be costly! Once you apply for a Mortgage, there are 10 things that you should be careful not to do during the mortgage process (or risk your loan not closing on time or at all!) When possible, try to avoid these mortgage mistakes:
- Don’t Buy a Big-Ticket Item – Save those purchases for after you close (Cars, boats, furniture, etc.)
- Don’t Quit or Change Jobs – Changing jobs can reflect instability in a lender’s eyes. Some are okay with it if you provide a letter of explanation, and work at the new job for a certain amount of time. Try to wait, if you can’t, talk with your Mortgage Broker first, to see what the lender will require.
- Don’t Pay your Bills Late – Late payments lower your credit score, and lenders not only monitor your credit during the mortgage process, but they may also re-pull your credit before closing.
- Don’t Open or Close any lines of credit – Both may have a negative impact on your credit score.
- Don’t ignore questions from your Lender or Mortgage Broker – that can delay your loan closing.
- Don’t let anyone else pull your credit – After you’ve found the Mortgage Broker you want to work with, hold off on any additional credit pulls until after you close. Again, credit inquiries lower your credit score.
- Don’t make large deposits other than your paycheck (especially cash!) – If you have to, expect to explain (and source) the deposit with a letter. If the deposits were a gift, you’ll also need a gift letter and source of funds from the donor.
- Don’t co-sign another loan with anyone – If you do, you are legally responsible for that debt, and it will increase your debt-to-income ratio.
- Don’t change bank accounts – If you are compelled to change, you’ll have to provide statements for both accounts, and source all funds.
- Don’t take out any payday advance loans – This reflects a lack of money management – not what you want to convey when applying for a mortgage.
We hope you found these Don’t-Do list of Mortgage Mistakes helpful! If you have any questions, feel free to contact us!