Top 10 Mortgage DO’s and DON’Ts on home loans when purchasing a home:
Our production Manager, Macy McLaren, will be contacting you to introduce herself and go over your file. She will be looking at everything you have currently sent in and will be looking at all our notes. She will be asking you for anything that may be missing in the file to get it ready for underwriting. Please SLOWLY read her emails to understand what she is asking for. Please give her everything she needs as quickly as possible. Especially the E-signature packages! Mortgage process is always “HURRY UP AND WAIT”.
One of the items that Macy is going to be asking you to do is setup a homeowner’s insurance policy. Get your homeowners insurance setup early in the loan process. You can use any insurance company you would like. Delaying the Homeowners Insurance policy is probably the most common issue we see that becomes an 11th hour issue in the process. We don’t want something simple like insurance causing a delay in your closing.
Be prepared to pay your appraisal with a credit card or debt card early in the loan process. Macy will be sending you a credit card authorization form when the time comes. Appraisals are always an closing cost that you will need to pay for upfront. The rest of the costs you will pay for in one lump sum when you come to the closing table. Side FYI – if this is condo/townhouse there might be some extra fees for the HOA to fill out forms.
Don’t get new credit financing. Keep away from credit card or any department store credit applications until after we close your loan. If you fill out any of those applications before we close your loan it will cause an inquiry on your credit report (possibly lowering your scores) and the underwriters will be asking you for a letter explaining if you have opened new credit accounts and how much the payments are, etc. There will be a domino effect that you will want to avoid.
ASSET Documentation: Keep your CASH under your mattress. DO NOT deposit it. We won’t be able to use it…that goes for selling Craiglist items, etc....You will need to provide complete bank statements with all pages (YES, even if last couple of pages are blank). Also, if your latest bank statement available does not include a recent deposit or transfer into the account that was made, we WILL NEED you to get an activity report printout. You will have to do the activity report printout correctly. You CANNOT do a simple print screen. When you are online looking at your activity screen, your bank will provide you with a “Download” or “Print” option, that is the correct way to provide us an activity printout because it will provide us with the last four of your account # and often times it will include the website page url at the bottom…that is what underwriters are looking for.
If you are planning on selling mutual funds/stocks/etc. and using those funds to close, please SELL them 3 weeks before your estimated closing date. This is a common issue because borrowers think they can do at the end of the loan process. We need the money to be in a liquid CHECKING OR SAVINGS account all ready to go 3 weeks before we close escrow.
Are you Getting a gift from a relative for your earnest money or down payment? If so, check with us to see if it is allowed on your loan and we’ll give you instructions on how to proceed.
Don’t change/quit your job. Seems obvious but it happens. Thinking about going from W2 to 1099 independent contractor? Ask us how it affects your approval. Please let us know if any job changes are happening.
If you haven’t filed your tax returns yet and you are planning on filing them, PLEASE ask us about it before you file. Filing your tax returns may cause an issue if we are in the middle of the loan process. We may recommend that you file before OR after your closing date.
Traveling?? Tell us before we start your loan.