Mortgage Loan Applications: Accepted or Rejected The Choice Is Yours!

The following are some tips to follow to avoid the delay or denial of loan approval for your new home, the tip at the bottom is the most important

•             Be honest with your loan officer about your financial wherewithal (all of your income, all of your debt).  If you don’t tell, your credit report, bank statements, pay stubs, and tax returns will.

•             Wait to buy or lease a new or used car, truck, van, boat, RV or any other vehicle until after you close on your new home, or you may find yourself living in it.

•             Do whatever it takes to keep your job, even if you dislike the boss, quitting your job, changing industries or starting a new company (becoming self-employed) will wreak havoc on your loan approval process.

•             Transferring large sums of money between bank accounts is a no-no. If you have a need to do so, check with your loan officer before transferring.

•             Pay your bills, all of your bills, on time, even the ones in dispute.

•             Just say “no” to any offers of new credit cards, even when they come with a tempting discount.

•             Large purchases on your existing credit cards or opening a new line of credit like the “12-months-same-as-cash” offers will have to wait until after you close, then you can buy all of the furniture and appliances your little heart desires and your wallet will allow.

•             Leave existing credit card accounts open, the ones with “zero” balances. Closing them may change your ratios, which help determine how much mortgage you qualify for.

•             Resist the temptation of accepting cash gifts without the proper paperwork.  Ask your lender before saying “yes”.

•             Random, undocumented deposits, out of the ordinary into your bank account will be found and scrutinized and may affect you receiving a thumbs up on the loan.

•             Keep your existing bank accounts intact, no changing accounts.

•             Co-signing a loan, for anyone, could be dangerous to your new mortgage health.

•             If you are applying for a loan that has income limitations and are planning on getting married, it might be best to marry after the closing, any extra income may knock you out of the running for the loan.  (Yes, it just happened.)

•             Bottomline, don’t do anything to change your financial position from the day you apply to the day you close on your new house/new mortgage.  Nothing.