While it may seem simple that you just need to keep paying your bills after the excitment of getting preapproved for a mortgage, some forget the little things! While the approval is good for 90 days, we will verify additional information during that 90 days.
Little things can mean an approval can change from approved to denied. What do you need to do to keep your loan approved?
-Do not shop for new credit. Now is not that time to open new accounts. Just because your lender pulled your credit report, don't think it won't be checked again. Your approval is good for 90 days but we are going to update the credit report just before closing. If there are new inquiries, we will ask why they are there and if there is new debt from the inquiries. If there is new debt, we need to re-do the approval and make sure you still qualify. Your credit score could also change and that could affect your interest rate.
-Do not make any major purchases. If you need furniture or appliances, wait until after you close. If you use credit to buy these items, we will need to make sure you qualify with the new purchases. If you pay with cash, it may affect the money you have for closing and reserves.
-Don't pay off all your debt. It uses your cash reserves and can affect your credit scores. Talk to your lender before doing anything with your credit.
-Don't co-sign for any loans. Sometimes people think that co-signing for a student loan will not affect them, but it does. You are also responsible for any co-signed loan and we will need to qualify you with the new payment.
-Don't change jobs. It may not seem like a big deal – you get an offer from another company and are making more money. It may not affect your loan but talk to your loan officer first. If your income changes to commission or 1099 income, it will definitely affect your approval.
Don't ignore any lender requests. If your loan officer or the processor asks for something, follow through and get them what they need. It may be a signature or an explanation. If you delay in getting it to them, it can affect your closing.
Keep a paper trail of all your deposits. Payroll deposits that are automatically deposited are ok. But if you deposit money into your checking or savings account, the underwriter will want to know where it came from and you will need to document the deposit.
Make sure you pay all your bills on time. We will have to check your credit report just before closing and any new late payments or collections may affect your approval.
Most of these seem like little things, but any one of them can affect your approval. If you have questions on anything, talk to your loan officer to make sure it won't affect your approval. It's better to ask first and then we can make sure everything will be ok. The last thing you want during a mortgage approval is to see that approval change to a denial.
Leslie Vanderwerf, NMLS ID#335509, American Mortgage & Equity Consultants – Email – Website
