So, after months of searching you have finally found the perfect home and have applied for a home loan. Congratulations! You’re on your way to home ownership. However, there are some things you don’t want to overlook. We know the feeling–you’re excited and looking forward to decorating your new place and making it your home. But before making any life changes, making any large purchases, or moving any of your money around, be sure you speak with your lender and find out if these will have an impact on your loan.
Things To Avoid When Applying For a Home Loan
- Don’t apply for any new credit accounts – regardless if it’s a car loan or a new credit card, it will impact your FICO score when your credit report is run by companies in different financial channels.
- Don’t change your bank accounts – remember, your lender is going to source and track your money and assets. It’s easier for lenders when they can see consistency among your bank accounts. So before transferring any money around, discuss this with your loan officer.
- Don’t close any of your credit accounts – it’s a common misconception that less available credit makes the borrower less risky and easier to get approved. Nothing could be further from the truth. The depth and length of your credit history is a key component of your credit score. Closing accounts will negatively impact this.
- Don’t co-sign on someone else’s loan – co-signing on a loan equates to obligation and with that obligation comes a higher debt-to-income (DTI) ratio. Even if you promise not to be the individual making payments on that loan, your lender will most likely count that against you.
- Don’t deposit any cash into your accounts until you have consulted with your bank or lender – since cash isn’t easy to trace and lenders need the source of your money, talk with them about the proper way to document your transactions.
- Don’t make any large investments or purchases – having new debt increases your (DTI) ratio. In the eyes of the lender, this makes for a riskier loan and could disqualify you from getting your home loan.
Contact Granite West Funding Your Mortgage Professional in California
Remember, any blip in your assets, credit, or income should be reviewed so that your home loan can still get approved. If you would like to know more about the process, call Granite West Funding today at (559) 540-2275. Our business representatives would be happy to be of assistance.