My Loan’s in Process…Now What?

Apply for a Mortgage in ColoradoAs you may or may not know, the processing of your mortgage loan can be quite intensive and stressful. In the current mortgage environment we’re in, your entire financial picture may very well be scrutinized by underwriting. Have you ever gotten that 11th hour call from your Loan Originator asking for one more bank statement or an explanation letter on a small deposit in your bank account? The reason for these conditions is that you are being critiqued from every possible angle to ensure you have the ability and willingness to pay back the mortgage you are applying for. Here are a few very helpful tips to use and keep your loan approval right on track!

1. Document every deposit you make into your bank accounts! Lenders are requiring documentation on almost every deposit that shows up on your bank statement. The reason for this is to ensure you have the sufficient funds available to handle your transaction. Simply keep a paper trail of all monies going into your bank account and keep record of all deposit slips. This way you can provide this to your lender at a moment’s notice if asked.

2. Keep your bank balances above zero! You may be asking, HUH? I know this seems like common sense but it’s more common than you might think. If you drain your bank accounts to a zero balance or over draw on your account, you may have some explaining to do. Lenders must ensure you have a reasonable ability to pay your mortgage and if your accounts are currently in the red, how is that going to look to a lender?

3. Don’t apply for any new credit! I know it’s tempting to go look at furniture for your new home on that great Holiday sale at the local furniture warehouse, but beware. Any new credit inquiry or extension of credit could have a detrimental impact on whether or not you will be approved for your home loan. The zero percent interest…same as cash sounds like a good deal and can be tempting but don’t buy the windshield wipers before you buy the car! (so to speak)

4. Pay your bills on time! It is very common for a lender to re-pull your credit right before closing. If a late payment or other credit issues arise, you most likely will be postponing your closing. Keep all of your bills on track so that you will not have to worry about something changing your entire deal at the last minute.

5. Communicate with your lender! Your loan officer is your ally, not your enemy. If you have a question regarding your finances, don’t hesitate to pick up the phone and get clarification. The last thing you want to do with any particular part of your finances is to “assume” and take a chance. This chance could be the downfall of your loan approval. It never hurts to ask the question (before you do something) so you know for sure that your transaction will not be in jeopardy.

This article was written by Brett Popish of Universal Lending.   He’s a great resource for any home buyer.  Check out his website where you can learn how to renovate your home and add the cost of the project into your loan through the FHA 203K Renovation loan, access all different types of mortgage calculators, and even view a directory of recommended professionals.

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