Things NOT to do during a Mortgage Transaction

Ensure a Smooth Home Buying Experience by Avoiding These Common Pitfalls

 

We want to make sure that your home buying process is as smooth as possible. Doing any of the following items can lead to huge problems when it comes to your mortgage pre-qualification process. Avoid these as much as possible!

  • Avoid large purchases, like cars or furniture, before closing on your home. They can reduce your savings and impact your debt-to-income ratio, risking loan approval.

  • Applying for new credit cards or loans can lower your credit score and increase debt, negatively affecting your mortgage approval and terms.

  • If you need to make a large deposit into your bank account, be prepared to explain and document where the money came from. Unexplained deposits can raise red flags for lenders.

  • Lenders prefer stability. Changing jobs during the home-buying process can raise concerns about your ability to make mortgage payments, potentially impacting loan approval.

  • Pay bills on time. Late payments can harm your credit score and indicate to lenders that you might be a risky borrower.

  • Closing credit accounts can decrease available credit and raise your utilization ratio, potentially lowering your credit score. Lenders consider your credit history and available credit during approval.

  • Switching bank accounts can complicate the documentation process for your loan. Lenders need a clear and consistent view of your financial history.

  • Skipping a home inspection to save money can lead to unforeseen expenses. Inspections can reveal potential issues that need addressing before finalizing the purchase.

  • Submitting your income and asset documents on time is essential. Delays can slow down loan approval and complicate closing on your new home.