Home ownership is part of the
American dream. If purchasing a house is the next
step in your many life stages, you’ll need to start
well in advance to prep your credit before visiting
lenders.
If you have already applied for a mortgage loan and
been approved, don’t mess up your loan status by
doing something that affects your qualification
during the loan approval.
Unfortunately, many buyers don’t know the lenders
can and will check, run their credit reports again,
confirm employments, the pre-approved clients even
up to day of closing. Depending on the latest credit
reports and credit scores in many cases, the
previously pre-approved buyer could be OK with no
change, denied of the loan completely or perhaps
qualified with higher interest rate and/or different
terms and conditions.
Following is a list of events that could impact
lender’s decision at the last minute, try to avoid
them. Explanation of each bullet list could be from
few paragraphs to pages and I have already written
blogs on some of the items. Due to the size, I am
just listing the items to avoid. If you want
explanation or the reasoning for each item, please
let me know I will provide that to you.
List of Don’ts After being approved for a Mortgage
Loan and before closing:
1.
Don’t be tempted to open a department store
charge card to receive discounts.
2.
Don’t apply for or accept any new Credit
Cards
3.
Don’t apply for a “Hard” Line of Credit
Increase.
4.
Don’t apply for a new loan.
5.
Don’t co-sign any loan.
6.
Don’t apply for a new credit card.
7.
Don’t allow anybody to run your credit report
8.
Don’t close any of your credit cards
9.
Don’t consolidate debts
10.
Don’t purchase a major item (neither with
your Credit Card nor with cash)
11.
Don’t let the ratio of Amount Owed to Credit
Line to be greater than 33% for each card.
12.
Don’t be late paying your payments or
obligations
13.
Don’t quit or change your job even within the
same company for better salary or position.
14.
Don’t get retired (usually you can ask your
employer to postpone for a month or so)
15.
Don’t get involved in a law suit and pray not
to be sued.
16.
Don’t file for bankruptcy, foreclosure, short
sale, etc.
17.
Don’t place a dispute on your credit report.
This causes more delay for approving a loan and
could cause a higher interest rate.
18.
Don’t make unexplainable deposits
into accounts used for qualifying
19.
Don’t pay off collections/charge offs
20.
Don’t ‘skip’ or ‘push the date’ on
other current monthly payments
21.
Don’t make loans to others
HOW to overcome the problems with your credit
history and credit score?
Knowledge, education, awareness, practice and
discipline are the essential keys to being
successful on any subject. The book,
"Credit Score Tips and Tricks",
provides you information, tools, techniques to
educate yourself and manage your credit report &
credit score, and therefore manage your finances
effectively at no additional cost.
I have decided to bring and share with you,
chapters or sections of my book,
Credit Score Tips and Tricks,
as series of
articles here. This is the number
28.2 of such a
series.
I also created and manage a GROUP in ActiveRain,
Credit Reports and Credit Scores, Please
feel free to join and share your thoughts and
experiences.
Contact us about your Real Estate
Questions
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