Avoiding Pitfalls when Getting your Home Loan

Getting a mortgage loan is never an easy experience, no matter how great your credit is.  Here are a few Do’s and Don’ts to follow during the loan process:

Recommended Client DO’S Recommended Client DON’TS
DO continue to make payments on time for current mortgages, cars, credit cards, etc. DO NOT increase credit card balances and/or loan balances.
DO paper trail, document, and explain any large or unusual deposits or withdrawals into accounts (checking, savings, stock, etc.). DO NOT apply for additional or new credit or put balances on a paid credit card.
DO keep pay stubs, bank statements, tax forms, etc., in case the lender needs to update the documentation prior to closing. DO NOT ignore late payment and/or collection notices that are received during the mortgage process.
DO ask questions if something is unclear about the loan program, fees, and/or loan conditions. DO NOT purchase anything that is “same as cash” — it will show on the credit report as a new debt.
DO let the loan officer or mortgage broker know if anything changes.  For example; employment, income, assets, credit history, etc. DO NOT buy furniture, cars, or appliances on credit until after closing.
DO document that the earnest money deposit has cleared the account — obtain a copy of the cancelled check and/or the statement that reflects the funds have cleared. DO NOT lend money to family members, friends, etc. if it is needed for closing.
DO lock-in the interest rate, have homeowner’s insurance agent information available and provide updated documentation (pay stubs, bank statements, etc.) in a timely manner so as not to delay the closing. DO NOT store money at home, place it in a bank account so it can be documented as savings throughout the loan process and can qualify as assets on hand.
  DO NOT have overdrafts on a checking account.
  DO NOT quit or change jobs during the loan process.



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