Whether you’re a seasoned home buyer or it’s your first time, applying for a mortgage can be stressful! Between finding all the required documents and understanding a long-term financial commitment, there’s a lot going on. And it doesn’t help that friends and family with the best of intentions give advice on the loan process that may or may not be 100% helpful.
That’s why we’ve put together a short and simple list of “no-no’s” when applying for a home mortgage loan. When you apply for a home loan, avoid these 8 mistakes:
Don’t cosign for another loan. If you’re right about to apply for a mortgage or you're in the verification process, cosigning on another loan may lower your credit score or negatively affect your home loan application.
Don’t make late payments. Make sure all your current loans, credit cards, and debt accounts are current and in good standing.
Don’t pay off any accounts or debts. Doing so may change your debt to income ratio unless your loan officer has specifically advised you to do so.
Don’t make any major purchase, sale, or financial decision. Wait until after your home loan has closed before taking any actions like this. This includes the purchase of furniture or appliances.
Don’t change bank accounts. Changing bank accounts after the initial application has been submitted may result in more paperwork. Additional financial documents may be required, which is both laborsome and time-consuming.
Don’t deposit money outside of your normal payroll. Avoid adding any money to your bank accounts during the loan application process.
Don’t open any new accounts. This goes for checking, savings, investment, or credit card accounts. In short, try to keep your financial landscape unchanged during the mortgage application process.
Don’t change jobs or companies. If you’re in the process of buying a home, don’t change jobs or companies. If the change is unavoidable (life happens!), reach out to your loan specialist as soon as possible.
A Quick Note
Following these rules of thumb in no way guarantees that you will be approved for a home loan. They are meant as guidelines to help qualified buyers from accidentally or unintentionally impacting their application process. Any questions should be directed to a home loan specialist. If you’re looking for a loan advisor in Spokane, I’d be happy to recommend a few!
Buying and Selling a Home in Spokane
Carrie Meyer, leader of the Real Estate Agent Spokane Team, transferred to real estate after a 30+ year career as a paralegal (Certified Legal Assistant). Her combined experience in law and real estate makes her a tour de force in contracts and negotiations.
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