BOULDER – The home loan process can be daunting, especially if you’re a first-time applicant. Since buying a home is one of the most significant investments that one can make, it’s important to have an understanding of what to do (and what to avoid) when you’re preparing to apply for a loan. Here, you’ll find guidelines that may help boost your chances of landing the loan that you seek.
The Do List
If you’re feeling a bit apprehensive about applying for a mortgage loan, you’re not alone. Many individuals experience similar feelings, but there are steps you can take to improve your likelihood of getting approved. First, be sure to closely monitor your credit accounts. Your credit should already be in great shape before applying, but it’s crucial to keep making timely payments in order to keep your score up. Additionally, stick with the credit pattern that you’ve established. Charging up your cards will almost certainly bring negative results, but any drastic change in your habits may show up as a red flag. If you have any questions regarding the application process, don’t hesitate to reach out to your mortgage professional for additional insight.
The Don’t List
The mortgage approval process is more stringent than it used to be, and one small mistake on your part could mean the difference between becoming a homeowner or not. It’s always wise to err on the side of caution, and there are several actions you should avoid before closing. For example, avoid applying for new credit cards after you’ve submitted your loan application. You may be looking forward to stocking your new home with décor and appliances, but wait until after closing to apply for new accounts. Each inquiry will impact your credit score, and lenders will take notice. Additionally, try to stay with your current employer; it’s best to refrain from making career moves during this time period. You may be tempted to start the job search when you’re preparing to relocate, but switching jobs before closing can be disastrous, and has the potential to de-rail the process. Before funding, your lender will check to ensure that your accounts are in good standing. While purchasing a home requires a lot of money, it’s important to keep an eye on your accounts and avoid letting them go into the red. Insufficient funds can spell trouble for your loan approval odds, so be sure to monitor your cash flow.
Applying for a mortgage loan is an exciting milestone.
By Michaela Phillips, Guaranteed Rate Mortgage. Michaela is the Vice President of Mortgage Lending at Guaranteed Rate, Inc. Contact Michaela at 303.579.5517, e-mail firstname.lastname@example.org or visitmichaelaphillips.com. NMLS:312874.