As I thought through the past 6 months of loan applications I realized how important it has been to remind my mortgage loan clients of 3 things. These 3 things speed up the processing of their loan application, prevent delays in processing, and document their file with critical information in advance of when it is needed (at final underwriting, which is just before closing, and can hold up closing). These 3 items of special importance are worthy of their own Blog Post!
The importance of borrowers NOT applying for credit (going to RC Willey's to shop for furniture and applying for credit), or allowing a creditor to access a credit report (a harmless test drive at the car dealership?) cannot be overemphasized! With new credit inquiries the file may need to go back to underwriting, after a new credit score is calculated, and what if the credit score drops? The mortgage rate may now be higher or what if the score is on the cusp of approval, drops 3 points and now is DENIED? Don't shop for credit, don't allow credit pulls. Don't!
Don't change employment! This one is self explanatory. Even with warnings, I have had borrowers do it. What if the new job has a mandatory probationary period? Don't change jobs!
The last item is a "heads up", we need this as soon as it happens. As soon as the Earnest Money Check clears the checking, savings, money market, stock account; PROVIDE proof that the check has cleared the account (front and back of the check, withdrawal of the cashiers check with a copy of the check face, bank statement showing check has cleared the account). This allows a CREDIT of the earnest money to be given at closing. IMPORTANT!