So you have been pre-qualified for a mortgage loan. Great! Now don’t do anything!
Your credit will be rechecked right before closing. Keep your transaction moving along smoothly by avoiding these mistakes:
- Increasing your debt. Your debt-to-income ratio is an important factor when being considered for a loan. If you add to your debt, you risk exceeding the acceptable ratio. So hold off on the new car or boat!
- Opening or closing credit accounts. Getting a new low- or no-interest credit card could sure come in handy to buy appliances, furniture and landscaping. But the application’s credit inquiry will ding your credit score for a few points, and raise a red flag with the underwriter. Even closing a credit account, which seems a positive step, can lower your credit score because your overall available credit has lessened.
- Missing a bill payment. This one may strike you as laughable, but you have a lot going on right now. It’s easy to forget to pay a bill when you’re figuring out how to move your family and all your worldly possessions. On-time payments are a huge plus for your credit score, and can dis-qualify you for your mortgage, so stay on top of your bills.
- Moving your money around. You have to provide your latest bank statements before you can get your loan. Big changes in balances are something underwriters want explained. If you have to move money, or you receive a gift, call me first! We want to make sure you can document the transactions and explain their purpose.
- Changing jobs. You don’t have to pass on a great career move, but changing employers could delay your closing due to employment and salary verifications.
Part of the mortgage process is a final check to ensure you can afford the loan. Avoid these mistakes and preserve your attractive credit profile.
And please, do not hesitate to call me if you have any questions. Getting a home loan is a big decision and can be intimidating! I am here to make it as smooth and stress-free as possible for you.