Avoid These Mortgage Mistakes to Keep from Getting Your Pre-Approval Revoked!
Getting pre-approved is a really important first step in getting into your dream home. But it doesn’t necessarily mean it’s all in the bag. Here are a few of the most critical mistakes to avoid once you’ve secured that pre-approval.
There are several mistakes you could make that could get your pre-approval revoked! And that is the last thing you want to have happen after you’ve negotiated a price, maybe even paid for a home inspection, termite inspection, appraisal, or mortgage application fee. Not only that, if you make one of these mistakes, it could potentially keep you from being approved in the future as well.
- Applying for a Credit – DO NOT and I repeat DO NOT apply for ANY credit until after your mortgage is closed. When you applied for pre-approval, your loan officer checked your credit report and score. You were pre-approved based off of this score. Any time you apply for credit, your credit score will change. No matter how good that interest rate is – just say no! At least until after your closing. This means no new car, furniture, etc. Don’t consolidate credit cards to a zero interest card. If you really must apply for credit, talk to your loan officer first.
- Don’t Quit Your Job – even if a better opportunity comes along! Many times your mortgage requires you to be employed for a minimum number of months. This is another one of those instances where you need to speak to your loan officer first. Sometimes, the final loan approval is out of their hands because it is handled by an underwriter in another state. Your loan officer can counsel you on this situation. Its important to keep the lines of communication open with him or her. They will want you to make the best decision for you and your family
- Pay Your Bills! Right before your closing, your lender will check your credit report and score once again. If you have fallen behind in paying your bills – even one late payment – it can negatively effect your credit score, which could cost you your final mortgage approval. So pay those bills on time!
- Don’t Make a Large Undocumented Deposit – your lender will probably request your checking and savings account statements for the last 3-6 months when you apply for your loan and once again before your closing. If you have deposited a large sum of money and it doesn’t match up with your average income, this will throw up some red flags. So, if Grandma is wanting to give you your inheritance before she passes on, ask her to wait until after your loan closing.
- Don’t Apply for Other Loans – did I already mention not to buy a car? Oh, I think I did… Anyway…don’t buy a car until after you close your loan!
- Don’t Get a Divorce – if you applied for the loan jointly with your spouse, the pre-approval is contingent on you and your spouse being married. If you get divorced, everything changes and chances are, your mortgage will be declined.
Additional Helpful Mortgage Resources
In conclusion, I can’t stress enough how important it is to get pre-approved. It lets sellers know you’re a serious buyer and provides you a tool to make a serious offer. It is important for you to stay in close communication with your agent as well as your lender throughout your home buying process, especially after you have agreed on a price and signed that contract. We would hate for you to find your dream home, only for your mortgage to be denied. Get your pre-approval and follow the steps above to make sure you keep it and will be in your new home soon!