Buying a home is often one of the most exciting milestones in life, but it can also be stressful and overwhelming. Even seasoned homebuyers admit that the process comes with its fair share of
Loan Do's and Don'ts
Dated: April 9 2024
Views: 193
Buyer client went furniture store shopping before closing, which caused a lender to deny the loan and they wouldn’t close! Here's how we resolved the issue: We had to get a refund for the furniture. I called the store manager of the furniture store while sitting at the closing table. The store manager agreed to credit their credit card back for the downpayment they paid on the layaway. And the store manager, with permission from my client, agreed to charge it back again the next day, which was the day after closing. With that refund receipt, the lender was able to underwrite it and close on time.
Here are my top 10 "do's and don'ts" if you are under contract and getting a loan.
Don’t Apply For New Credit. Every time that you have your credit pulled by a potential creditor or lender, you can lose points from your credit score immediately.
Don’t Pay Off Collections or “Charge Offs.” If you want to pay off old accounts, do it through escrow, making sure that the debt is yours. Request a “letter of deletion” from the creditor.
Don’t Close Credit Card Accounts. If you close a credit card account, it may appear that your debt ratio has gone up.Closing a card will affect other factors in the score, including credit history.
Don’t Max Out or Over Charge Credit Card Accounts. Try to keep your credit card balances below 30 percent of their limit during the loan process. If you pay down balances, do it across the board.
Don’t Consolidate Your Debt. When you consolidate all of your debt onto one or two credit cards, it will appear that you are “maxed out” on that card and you will be penalized.
Don’t Do Anything That Will Cause A Red Flag To Be Raised By The Scoring System. This includes adding new accounts, co-signing on a loan or changing your name or address with the bureaus.
Do Join a Credit Watch Program. Then, you may check your own credit reports regularly (you won’t get dinged for a “hard” inquiry). Plus, if something unexpected does show up, you can address it promptly.
Do Stay Current On Existing Accounts. Like your mortgage and car payments, one 30-day late notice can cost you.
Do Continue To Use Your Credit As Normal. Red Flags are raised easily with the scoring system. If it appears that you are changing your pattern, it will raise a red flag and your score could go down.
Do Call Your Loan Officer. Your Loan Officer may be able to supply you with the resources you need to stop any derogatory reporting to the bureaus. Ask for details.
Cynthia Hash
Helping people is my passion! Problem solving is my gift. You're probably here to find out if I'm worthy of your trust... The experience, education, and Certifications that I have earned puts me in th....
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All information deemed reliable but not guaranteed. All properties are subject to prior sale, change or withdrawal. Neither listing broker(s) or information provider(s) shall be responsible for any typographical errors, misinformation, misprints and shall be held totally harmless. Listing(s) information is provided for consumer's personal, non-commercial use and may not be used for any purpose other than to identify prospective properties consumers may be interested in purchasing. The data relating
