4 Do’s and Don’ts
During The Loan Process
Don’t – Apply for new credit until the loan funds.
(Adding multiple credit lines require multiple credit inquiries which can cause
your score to drop initially)
Don’t – Allow multiple credit checks.
(Excessive rate shopping can lower your score with too many inquiries)
Don’t – “Shop” for new credit before closing (Home
furnishings, cars, etc.)
(Excitement to furnish a new home is natural, but don’t get sucked in to a
salesman’s pitch for zero down for 5 years until after your loan closes. Every credit pull during this time can
negatively affect your credit)
Don’t – Dispute anything on a
credit report
(Fannie Mae and FHA both do not allow disputed accounts on a borrower’s credit
report, so wait until after your loan closes to dispute any accounts, and
resolve any current disputes)
Do – Disclose all debt – sometimes there will be debt not
disclosed on your credit report and lenders need to know about it.
(Underwriters will usually uncover addition debt not disclosed on the
application or on the credit report.
These “new” payments can easily ruin a closing by negatively affecting
your ratios)
Do – Explain or document all inquiries on your credit
report.
(If you were just “shopping around” and didn’t buy anything a simple letter of
explanation as to why your credit was pulled will suffice. If you did make a credit purchase it needs to
be disclosed sooner than later so the payment can be factored in)
Do – Communicate constantly with your loan officer and real
estate agent.
(Last minute credit emergencies can be a death sentence for a loan. Don’t be embarrassed to discuss an emergency
loan to a family member or a medical emergency that comes up. These are much more effectively worked
through with as much time as possible to determine if the loan will still
qualify)
Do – Pay all your bills on time
(even confirm them during the loan process as a 30-day late can ruin a mortgage
loan, even if the last 7 years of payment have been late-free)
For more information regarding the purchase of a home or
other mortgage topics, contact myself or your local mortgage professional.
Rob Smee, Mortgage Consultant – Country Club Mortgage.
328 W Felspar Ave Ridgecrest Ca 93555
