Congrats! You’ve taken a huge step towards homeownership by submitting your mortgage application. Now you can finally picture yourself curled up with a cup of tea in your new living room, right? Hold on a sec, there are still a few hurdles to clear before you get the keys.
While the waiting game begins, it’s important to maintain a squeaky-clean financial profile. Lenders will re-verify your income and assets before finalizing your loan approval. So, let’s talk about some things to avoid during this home stretch to ensure a smooth journey to closing day.
What is a Mortgage?
A mortgage is a loan you take out from a bank or lender to buy a property. You pay back the loan with interest over a set period, typically 15 or 30 years. Think of it as an investment in your future dream home!
Financial Housekeeping: Keeping Things Stable
Here’s the deal: lenders like stability. So, avoid any major financial changes that could raise red flags during the verification process.
- Don’t go on a spending spree! Putting a down payment on a house is exciting, but resist the urge to splurge on new furniture or that fancy gadget you’ve been eyeing. Big purchases can increase your debt-to-income ratio, making you a less attractive borrower in the lender’s eyes.
- Hold off on that new car (or any new credit for that matter). Adding new debt means new monthly payments, which can impact your ability to afford the mortgage. New credit inquiries can also ding your credit score, another factor lenders consider.
- Be cautious with large cash deposits. Lenders need to understand the source of your funds. Unexplained large deposits might cause delays. If you have a legitimate reason for a big deposit, talk to your loan officer beforehand.
- Maintain your employment status. A steady income is crucial for securing a mortgage. Changing jobs during the application process can raise doubts about your financial stability. If a job change is unavoidable, discuss it with your loan officer as soon as possible.
- Keep your bank accounts and credit cards the way they are. Don’t close accounts or transfer funds between accounts without informing your loan officer. Lenders need to verify your assets and liabilities easily.
Being Responsible: Stay on Top of Your Bills
This one’s a no-brainer! Missing payments on any existing debts can negatively impact your credit score. Make sure all your bills, including rent, utilities, and credit cards, are paid on time during the mortgage application process .
Communication is Key!
- Stay in touch with your loan officer. Keep them updated on any changes in your financial situation, even if they seem minor. Open communication builds trust and ensures a smooth closing process.
- Be patient. The mortgage process can take time. Don’t hesitate to reach out to your loan officer if you have questions or concerns.
Bottomline:
By following these simple tips, you can avoid any last-minute hiccups and ensure a smooth transition into your new home. Remember, a little financial discipline goes a long way! Now go forth, conquer that mortgage marathon, and celebrate your homeownership journey!
Ready to turn your dream of homeownership into reality? Reach out to us today and discover a world of possibilities!
For more information, please visit www.freemanwangteam.
Freeman Wang
Team Lead at Freeman Wang Team with Your Home Sold Guaranteed Realty
+1 6265245021
Fwang@YourHomeSoldGuranteed.com
