Top Mistakes to Steer Clear of during a Mortgage

Top Mistakes to Steer Clear of during a Mortgage

Annette Bui | Updated June 08, 2020 | Mortgage Programs 101

All too often, I hear home buyers not being informed by their past lender during a loan transaction and falling into some of these pitfalls below. It is crucial during a loan approval whether you are shopping for a new home or looking to refinance an existing mortgage to withhold from the following.

 

1.      Don’t move money around, multiple large transfers will create more documentation and sourcing.

 

2.      Don’t create RED flags by avoiding new credit accounts, co-signing a loan, changing name or address.

 

3.      Don’t pay off derogatory collections or charge offs unless a creditor will issue a letter of deletion.

 

4.      Don’t increase credit card balances- higher credit balances will drop your credit score and impact loan eligibility.

 

5.      Don’t fall behind on debt payments-anything over 30 days from the due date will drop your credit score.

6.      Don’t dispute credit report-new disputes will create conflict with underwriting and delay or stop closing.

 

7.      Don’t apply for new credit-new credit inquiries will cause your credit to drop.

 

8.      Don’t make large deposits over $1,000 unless it is the form of a check. Cash deposits combined with check deposits will create issues with underwriting.

 

9.      Don’t make any changes to your work hours, title and position or job changes.

 

10.  Don’t make any changes to your billing payments, utility expenses etcetera.