Applying for a home loan can be a stressful time, but doesn’t need to be if you follow certain rules that can unexpectedly trip up your mortgage loan approval.
Some of these tips will be obvious, while others won’t – but all of them are items that regularly cause underwriting headaches. Avoiding these mistakes will help lead to a smooth stress free home loan closing.
- DO continue to live at your current home.
- DO continue to make your home loan payments or rent payments on time
- DO continue to use your credit as normal (but see don’t items)
- DO keep working at your current job.
- DO keep your same insurance company.
- DO stay current on all your existing accounts.
- DO keep credit card balances low (below 25% of available credit is perfect)
- DO call your home loan expert if you have any questions.
DON’T do any of these items within 90-days of application or until after closing
- DON’T apply for ANY new credit. No cars, no furniture, no credit cards, no cell phones, no boats, no new loans of any kind
- DON’T buy any furniture ON CREDIT after you’ve found your dream home
- DON’T close any credit card accounts, or consolidate your debt onto one or two credit cards.
- DON’T pay off any loans or credit cards without discussing it with your Loan Officer.
- DON’T change bank accounts
- DON’T move money around from one account to another.
- DON’T pay off collection and charge offs accounts without a discussion with your home loan expert.
- DON’T amend your tax returns
- DON’T start any home improvement projects, or don’t bother applying until any current project is finished
The biggest item left is simply this… ALWAYS tell your Loan Officer EVERYTHING. Not thinking it is important, or even straight up lying, is only going to cause trouble down the line. You’d be surprised at the checks underwriting does during the process, and the things that are “discovered”. Mention everything it to your licensed Loan Officer right away so they can help you determine the best way to achieve your home loan goals, and avoid any unnecessary delays or surprises during the process.