Do Not Jeopardize Your Pre Approval
Most homebuyers begin the process by searching online for homes for sale, according to the National Association of Realtors. With no idea of how much they can spend on a home, there they are, surfing the Internet for homes for sale.
You know better than that, right? You know that the first step in the process is to see a lender to get pre-approved for a mortgage. That way, you won’t waste your time or be hugely disappointed by looking at homes you can’t afford.
Something you may not have been told, however, is that once you have loan preapproval it is critical that you make no changes to your financial picture until after the loan closes. In other words, that preapproval is not a guarantee that you’ll get the loan regardless of changes in your finances.
Here’s the Secret
Well, it’s not really a secret, it’s just not widely known to consumers, which is a pity really. Your lender will perform what is known as a “soft pull” of your credit just prior to closing. It’s known as “soft” because it doesn’t impact your credit score.
The lender is looking for a change in your credit score and checking for new credit accounts and other changes on your reports. If any are found, your debt-to-income ratio will be re-calculated. Depending on the changes found, your loan may not close.
Imagine, after all you’ve been through with price negotiations, the home inspection, perhaps additional negotiation, the appraisal and more, the lender tells you at the last minute that the house won’t be yours.
What to Avoid
It’s tempting to want to shop for new appliances and furniture once you’ve found your new home. Do not, however, give in to that temptation.
In fact, don’t change even one aspect of your financial picture (including changing jobs) from the time you are pre-approved for a mortgage until closing. Do not open new accounts. In fact, don’t even apply for new credit. Do not make large purchases on credit or otherwise change the income stated on your original loan application.
Energy Efficient Windows can Help you Sell your Home
2020-12-28
3 Unique Aspects of the Luxury Home Sale
2020-12-26
No Down Payment? Now Worries!
2020-12-22
3 Important Aspects of the Purchase Agreement
2020-12-19
2 Things to Consider Before Buying a Townhome
2020-12-17
Buying your First Home? Avoid these 4 Common Mistakes
2020-12-14
3 Surprising things that Positively Impact Home Value
2020-12-12
Do Not Jeopardize Your Pre Approval
2020-12-10
The Modern Baby Nursery
2020-12-07
4 Steps to an Organized Garage
2020-12-04
3 Most Important Insurance Policies when you buy a Home
2020-12-01
4 Tips for Home Buyers with Boats
2020-11-28
3 Reasons to Think Twice about a Home
2020-11-26
3 Importat Tips for Selling a Vacant Home
2020-11-23
Inexpensive DIY Staging Tips
2020-11-20
Everything you need to Know about Relocating (Part 4)
2020-11-17
Everything you need to Know about Relocating (Part 3)
2020-11-17
The Eagles Community Grocery Gift Cards Winner Announcement
2020-11-14
Everything you need to Know about Relocating (Part 2)
2020-11-13
My interview with Bay News 9!
2020-11-11
Everything you need to Know about Relocating (Part 1)
2020-11-11
My interview with Bay News 9!
2020-11-09
My interview with Bay News 9!
2020-11-08
Shopping for a Lender
2020-11-07
My interview with Bay News 9!
Click here to see ALL articles.