You are here: Family Sites Catalog » Mortgage Do’s and Don’ts that you should know

Family Sites Catalog

May 29

Mortgage Do’s and Don’ts that you should know

When you are planning to buy a new home or to refinance your current one, there are a few things you should do and some that you should not in order to obtain an advantageous loan. Your credit score is highly sensitive to change, which is why you should try and maintain your finances as stable as possible and avoid making any important investments until your loan closes. Click here if you want to find a professional mortgage broker to offer you competent advice.

The Do’s

 

Do keep a close eye on your documentation

You need to provide all documentation of the sale of personal items, car, employer relocation and anything else that applies in your situation. In addition, always keep all the originals including bank statements and other financial documents, even if at first you might think they are not very important. You never know when you might need them and you can always count on them making a difference in your final credit score.

 

Do notify your loan officer in the following situations:

When your employment status changes, regardless of it being a promotion, demotion or job loss or if you plan to receive gift funds for closing you should always notify the person in charge of your case. In addition, you should tell your officer of any loss of income or address, phone or email change.

 

Do use your credit card normally

If you change your spending habits a red flag will be raised that perhaps you are having financial difficulties and this will determine you credit score to go down. For instance, if you have had an internet subscription monthly billed for the past two years, this is not the time to cancel it. Wait to do this after your loan is closed.

 

The Don’ts

 

Don’t max out on any credit card

The fact that you are not maintaining a financial stability is bound to affect your credit score. This is not the time to go on a shopping spree and max out your credit cards. Try to keep them below the available limit with at least 30%. This will make you seem like a responsible person and may even get you some extra points.

 

Don’t make major purchases

The fact that you are trying to apply for a mortgage, means that you do not have enough finances to buy your home without the help of a loan. Therefore, when you choose to spend money on a new car or furniture, you will seem like someone who does not necessarily qualify for a loan and your chances of it being approved can decrease considerably.

 

 

Related articles