The Lender Process – Part 2

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So you have a house under-contract and you have applied for the loan but you are not done.  This is often an exciting time where you are imagining the new house of your dreams and the items that you are going to fill it with to make it a home but in order to keep yourself on track to secure that mortgage you need to maintain restraint.  The lender will continue to monitor your creditworthiness until your closing date and could pull a loan if you are not careful.  The following is a list of things to pay attention to while awaiting your closing date.

  1.  Watch your credit card spending – Debt to Income ratios are very important as well as credit scores.  Credit card spending can cause both your credit score and your Debt to Income ratios increase so it is recommended that you keep credit card spending to a minimum.
  2. Make no large purchases – Avoid the pressure of buying that brand new dining room set or bedroom furniture until after you purchase the house.  Large purchases may bring new installment lines of credit which can negatively impact your lender’s ability to give you a loan.
  3. Limit the Number of Credit Inquiries – Credit inquiries can cause your credit score to drop which could change the rate your qualify for when you apply for a loan.  If you are unable to lock in a rate or extend a rate lock and your credit score drops you may be unable to get the same rate or a loan if you are on the edge of a credit score requirement

The best advice for this situation is “if you don’t absolutely need it, avoid it until your house closes”  This will put you in the best position to secure the loan and get your new home!

If you have questions about buying or selling a home contact Rob Callaghan at 704-778-8653 or Alex Austin at 704-724-6312.

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