5 Loan Mistakes to Avoid

By
Real Estate Broker/Owner with MBA Broker Consultants CalBRE Broker #00983670

Once you apply for a mortgage loan, be careful not to disturb the loan process. If your loan qualifications change during the loan process, you may lose your loan approval. It is important to avoid the following until AFTER your loan has closed escrow.

1. KEEP YOUR MORTGAGE CURRENT.
It is critical to keep making your mortgage payments or rent on time. The loan approval depends on your payment being current. 

2. DO NOT APPLY FOR CREDIT.
Buying a new car, or applying for credit, impacts your ability to buy a home. A large monthly debt payment can affect the amount of home for which you qualify and make it difficult or impossible to get your loan approved.  Also it will ding your credit score.

3. DO NOT CHANGE JOBS.
Changing jobs before or during the loan process may disqualify you for the loan, especially if that job is in a different line of work or at a lower rate of pay. Also, the new job will need to be re-verified, which delays the loan.

4. DO NOT MOVE YOUR MONEY AROUND.
It is best to leave your money right where it is until your loan closes. Moving your money to a new bank or even into a new account can upset the loan verification process.

5. DO NOT PAY OFF BILLS IN FULL.
If you need to pay off your bills to qualify for a loan, your loan officer will advise you of the best way to pay off bills (usually through escrow) and make sure you have the necessary evidence to prove the bills were paid. Otherwise, it could impact the loan procedure and delay the approval.

If you must break one of the rules above, contact me.  I can advise you of your options and re-qualify you if necessary. By following these rules, you should be able to close your loan successfully.

 

Posted by

Regina P. Brown
Broker, Realtor®, M.B.A., e-Pro, GREEN
California DRE # 00983670
www.CalCoastCountry.com

                

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Comments (3)

Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

This is a great post and I always have "the talk" with buyers prior to going out to look at property.

Jun 06, 2014 12:53 PM
Roy Kelley
Retired - Gaithersburg, MD

This is excellent advice for mortgage borrowers. Real estate agents should be advising home buyers on what to do and not do during the mortgage pending process.

Jun 07, 2014 12:58 AM
Regina P. Brown
MBA Broker Consultants - Carlsbad, CA
M.B.A., Broker, Instructor

Joan, there is nothing more disappointing than the buyers' mortgage loan being denied because they went out and bought new furniture last week!

Roy, this great advice was the basis for my book, "Buy Your First Home".  I wrote down the advice I gave to home buyers and it kept growing and growing until it morphed into a book!

Jun 07, 2014 06:23 AM