7 Things Not to Do After Applying for a Mortgage [VIDEO]
Below is a list of 7 Things Not to Do After Applying for a Mortgage!
1. Don’t change jobs or the way you are paid at your job! If possible, you’ll want to avoid changing from salary to commission or becoming self-employed during this time as well.
2. Don’t deposit cash into your bank accounts. Lenders need to source your money and cash is not really traceable. Before you deposit any amount of cash into your accounts, discuss the proper way to document your transactions with your loan officer.
3. Don’t make any large purchases like a new car or new furniture for your new home. New debt can make you ineligible to buy a house. And if you have a higher debt-to-income ratio because of the new debt, you may also be hit with a higher interest rate.
4. Don’t co-sign other loans for anyone. When you co-sign, that becomes your debt as well and you are obligated. Your lender will have to count the payment against you.
5. Don’t change bank accounts. Before you even transfer money between accounts, talk to your loan officer.
6. Don’t apply for new credit. It doesn’t matter whether it’s a new credit card or a new car. When you have your credit report run by multiple lenders, your FICO score will take a hit. Lower credit scores mean higher interest rates and/or a higher down payment or possible denial of your loan.
7. Don’t close any credit accounts. Many people believe they should pay down all of their debt and close their credit accounts. This is exactly the WRONG thing to do. A major component of your score is your length and depth of credit history (as opposed to just your payment history) and your total usage of credit as a percentage of available credit. Closing accounts has a negative impact on both of these components of your score.
Get to the finish line first
Don’t make any big or small money moves after applying for a mortgage. Wait until the deal is closed and you have the keys to your new house in your hands.