If you’re currently searching for a home to buy in Raleigh, chances are you’ve already thought about applying for a mortgage.
Obtaining a mortgage loan is a huge part of the buying process, as it has an enormous impact on how much you can afford and how much your monthly payments will be.
As such, it’s important to be extra cautious with your finances—and your credit—while you’re applying for a mortgage in Raleigh. Time and time again, we hear from clients about the mistakes they’ve made while waiting for their mortgage loan to finalize. We want you to make decisions that guarantee financial success—which is why we want to share with you the following list of things to avoid after you’ve applied for a mortgage:
Don’t Change Jobs or Get a Demotion at Work
While this may sometimes be out of your control, do everything in your power to maintain consistent employment during the approval process.
Changing from salary to commission, or deciding to go freelance, should really wait until after you’ve closed on your home.
Avoid Depositing Large Sums of Cash Into Your Account
Cash is untraceable, and during the approval process your loan officer will be taking a close look at your checking account.
They want to make sure your cash flow is accounted for and traceable, so if you do need to deposit cash into your checking account make sure you talk it over with your bank first.
Do Not Make Any Huge Purchases
This includes buying a car, expensive furniture, or anything else that’s going to put you in any more debt! Hide your credit cards from yourself if you must.
If you go into too much debt during the approval process, you may no longer qualify for that loan amount. This happens if your ratio of debt to income becomes too debt-heavy.
Don’t Volunteer to be a Cosigner
When you cosign on someone’s loan, you’re then obligated for their loan if they default. This affects your debt-to-income ratio which may then disqualify you from the loan that you’ve applied for.
Don’t Change Bank Accounts
Remember, your loan officer needs to be able to track your sources of income and spending. Having a consistent bank account and transactions makes this ten times easier.
Don’t Apply for New Credit Cards or Loans
Don’t apply for any new credit accounts! Hard inquiries on your credit may negatively affect your FICO score.
If your score drops too much in a short amount of time, you may no longer qualify for your loan.
Don’t Close Any Accounts
Closing a credit account also negatively impacts your score! Your credit score is based upon both the length and depth of your credit history.
Closing an account affects that depth. Your credit score is essential to your mortgage loan interest rates, so it’s critical to keep them as high as possible when applying for a mortgage!