What to Avoid When Applying for a Mortgage
There are many things that will ruin your mortgage application. Here are seven of them that you should avoid.
If you’re a prospective homebuyer who is thinking about applying for a mortgage, here are a few things you should absolutely avoid doing:
1. Don’t change jobs. Your loan officer will have to track your source of income, so switching from a salary to being self-employed or vice versa should be avoided until you at least close on the property.
2. Don’t deposit cash in your bank accounts. Cash is simply not traceable. A lender doesn’t want to see untraceable funds.
3. Don’t make any large purchases. Don’t buy a car, or new furniture, or anything else on credit before you close on your home purchase. These things might change your debt-to-income ratio enough so that you no longer qualify for your loan.
"You can shop around for lenders, but don’t open any new credit cards."
4. Don’t co-sign for any loans. It may seem like a good idea, but that loan will be on you to pay back as long as it’s not paid back and it will raise your interest rate and your debt-to-income ratio.
5. Don’t apply for any new credit. Shop around for lenders, but don’t open any new credit cards.
6. Don’t close any credit card accounts. In most cases, your lender wouldn’t want you to close your account. They want to see consistent payments without paying it all off.
7. Fully disclose your financial structure and discuss your plans with your loan officer. Doing so will help you avoid roadblocks in the future.
If you have any questions for me in the meantime, don’t hesitate to give me a call or send me an email. I look forward to hearing from you soon.