The Do’s & Don’ts of Mortgages
If you are considering purchasing a home now or in the future , here is some useful information that will make applying for a mortgage smoother.
Before searching for your new home, you should always get a pre approval letter. This helps you know exactly what price range you should be looking in and when you find that home you will be able to present the pre approval letter with your offer. The RED Team is always here to help connect you with an experienced Loan Officer that will be able to provide you with all the information you need.
Choose a Loan Officer/ mortgage company that offers a simple, streamlined process that helps you obtain your mortgage as efficiently as possible. One that has the tools to make the loan application process as convenient for you as possible. Maybe applying online and uploading your documents electronically is how you would like to apply or maybe you prefer to meet with a Loan Officer in person. An experienced loan professionals will be happy to go over the details of your loan in person.
Our friend Robin Turney with AMC Mortage has provided the list of Do’s & Don’ts.
DO
Keep All Records in Good Order.
Availability – Keep your financial records
close at hand in case updates are
requested.
Income – Be aware that underwriters
typically verify your income and tax
documents through your employer(s), CPA,
and/or IRS tax transcripts. Hold onto new
pay stubs as received.
Assets – Continue saving incoming account
statements. Keep all numbered pages of
each statement. Ex. 8 of 8.
Gifts – If you’re receiving any gift money
from relatives, they’ll need to sign a gift
letter (we’ll provide) and an account
statement evidencing the source, which
must be “seasoned” funds.
Current Residence – If you’re renting,
continue paying your rent on time and save
proof of payment. If you’re selling your
current residence, be prepared to show
your HUD-1 Settlement Statement. If you’ll
be renting your home, you may need to
show sufficient equity, a lease and receipt
of the first month’s rent and security
deposit.
Keep your credit shining – Continue making
payments on time. Your credit report may
be pulled again, and any negative change to
your score could cause you to lose your
approval and your home.
Understand that things have changed.
Underwriters require more documentation
than in the past. Even if requests seem silly,
intrusive or unnecessary, please remember
that if they didn’t need it, they wouldn’t ask.
DON’T
Apply for new credit – Changes in credit can
cause delays, change the terms of your
financing or even prevent closing. If you
must open a new account (or even borrow
against retirement funds), please consult
with me first.
Change jobs during the process –
Probationary periods, career or even status
changes (such as from a salaried to a
commissioned position, leave of absence or
new bonus structure) can be subject to
very strict rules.
Make undocumented deposits – Primarily
large but sometimes even small deposits
must be sourced unless they are identified.
Make copies of checks and deposit slips.
Keep your deposits separate and small.
Avoid depositing cash.
Wait to liquidate funds from stock or
retirement accounts – If you need to sell
investments, do it now and document the
transaction. Don’t take the risk that the
market could move against you leaving you
short of funds to close.
Ever be afraid to ask questions – If you’re
uncertain about what you need or what you
should do, I’m here to help you through
the process, even long before you intend
to buy.
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