By Bill FitzMaurice
May 19, 2016
You found your dream home and your offer was accepted. Congratulations, but before you start packing for your big move there are some definite Do’s & Don’ts we recommend buyers to follow as they go through the loan process.
DO ask donor(s) for gifted funds as soon as possible, if being used towards your down payment. Ask your Loan Officer about the necessary steps and documentation for gifts.
DO stay current on all your payments: mortgage, car payments, credit cards, student loans and any other debt.
DO continue to use your credit as normal. Changing your pattern may raise a red flag, causing your credit score to go down.
DO wait to make a major purchase such as a new car, boat or appliance until after your loan has funded.
DO keep copies of all important financial documents so you will be ready to provide if asked: check stubs, W-2’s, tax returns, bank and investment account statements, rental agreements, etc.
DON’T keep cash in a safe or an overseas account if you plan to use these funds as a down payment. Ask your Loan Officer how and when would be the best time to put funds into your U.S. bank account if needed.
DON’T close credit card accounts. Keeping accounts open after you have paid them off lowers your debt-credit ratio. If you close a credit card account, it may appear that your debt ratio has gone up.
DON’T apply for new credit or give your personal information to anyone else who might run your credit report. Multiple credit inquiries may hurt your credit score.
DON’T make career moves. Your mortgage lender must verify your employment, so it’s crucial to maintain employment status.
DON’T make large deposits into your back account unless 100% necessary. If you must, save the documentation showing where the funds came from. Keep a “paper trail”.
Make sure to discuss any changes in your financial situation with your Loan Officer right away.
About the Author: Bill FitzMaurice is a Senior Mortgage Consultant (NMLS #290216) with New American Funding. For more information about home financing you may contact him at (949) 291-1770.