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Wednesday, October 31, 2012

Things to avoid when purchasing or refinancing

There are four major things to avoid doing before applying for a loan and during the loan process itself.  Any one of these four things can greatly impact your ability to qualify for a mortgage loan, so it is critical to avoid doing any of the following until AFTER your loan is closed. 

IMPORTANT: Your loan is funded and recorded (closed) when you get your keys on a purchase transaction and for a refinance transaction your loan is closed when you have gone through the 3 day right of rescission period and your loan has been funded and recorded (you will receive a phone call or an e-mail from me or my processing team that your loan has been completed!).  

Here are the 4 things to avoid when purchasing or refinancing: 

1.      Do not change jobs

Changing jobs before or during the loan process can create a real problem in qualifying you for a loan, particularly if the employment is in a different line of work or at a lower rate of pay.  During the loan process changing jobs can create time delays because the new job will need to be verified. My closing department will verify your job right before we hit the button to fund your loan! Don’t quit your job or change jobs after you sign the loan papers, right before funding of your loan.   

2.      Do not switch banks or move your money around

It is best to leave your money right where it is until your loan is closed.  Moving your money to a new bank or even into a new account can wreak havoc with the verification process and with my processing team.  Please be nice to them!  If there is an absolute need to do so, please be sure to retain copies of all the receipts in the transaction.  When my processing team asks you for them (which they will!) you will have the necessary documentation. 

3.      Do not pay off bills

As I analyze your debt to income, I will let you know if it is necessary to pay off bills to help qualify for the loan.  If you need to pay off bills, I will explain the best way to pay them off to make sure we have the evidence we need to prove that the bills have been paid.

4.      Do not make any major purchases

Many borrowers make the mistake of buying a new car, some furniture or making another major purchase without realizing the impact it can have on their ability to buy a home.  A large monthly payment can affect the amount of home you qualify for and during the loan process itself it can actually make it extremely difficult to get your loan approved!  PLEASE talk to me or my processing team BEFORE making any NEW major purchases! 
If you must do any of the things listed above (even if you’ve only been pre-qualified for a purchase or refinance) contact me or my processing team immediately.  We can help you if necessary and advise you of your options.  By avoiding these four things, you can look forward to a successful loan closing!  We look forward to helping you!