Do’s and Don’ts When Applying for a Mortgage

 

The mortgage process can seem confusing, if you do not have the right loan consultant guiding you through the whole process. So let’s breakdown the most common do's and don'ts borrowers may encounter in the home buying and mortgage process.


  • Do notify your loan officer of any income changes

    • Whether it be a raise in salary or a decrease in hours worked, notify your loan officer if there is any changes to your income or job while in the mortgage process. The slightest change in income can have detrimental affects to you qualifying for a loan. The more time your loan officer has with this information, the better chance they have in coming up with a plan for you to combat any income change.

  • Do keep documentation of all large deposits into your bank account

    • Lenders will verify where you received the money from for any large deposits seen in your bank account. This could include copies of checks, bank statements, and letters explaining deposits.  Knowing you will be questioned on large deposits, helps to remind you to keep track and organize your documents to prepare to source these deposits.  Your loan officer will also help devise a plan for adding gifts deposits into your account. If you know you will receive a gift in purchasing your home, tell your loan officer, so they will provide you with a very detailed way to enter this into your account. Try to refrain from moving your money around between accounts for 2 months prior to searching for a home if possible. If you keep all of the funds you intend to use for the purchase in 1 account it will make the process smoother and your life easier.  

  • Do pay bills on time

    • Stay current on existing credit accounts. This can be the difference in qualifying for a mortgage. One 30-day late can cost you between 50-100 points on your credit score and prevent your loan from going through. Your credit report is monitored consistently throughout the mortgage process, so any late payments will be relayed to the mortgage company.

  • Don’t apply for new credit of any kind

    • Every time that you have your credit pulled by a potential creditor, your credit score could be adversely affected. Keep credit pulls to the bare minimum during the mortgage process.

  • Don’t over charge on your credit cards

    • Since all lenders check your credit report immediately before settlement, the best policy is to not use credit cards during the loan process. If you do need to use them, try to keep your balance below 40% of your total credit limit, if possible. 

  • Don’t consolidate your debt onto 1 or 2 credit cards or eliminate cards

    • When you consolidate all your debt onto one card, it appears that you are maxed out on the card. This can negatively affect your credit score. Also if you close any credit your scores are very likely to drop affecting your ability to qualify for a home.

  • Don’t change/quit you job

    • If you plan to change jobs, please consult your Loan Officer immediately. Employment history is analyzed in the approval of your loan, so it is important if you are planning to make any changes in employer or position, that your loan officer knows ahead of time.



All of these common don'ts do have some workarounds if they absolutely must be done, but consulting with your loan officer prior to making any changes to your mortgage application is essential to continue the process successfully and with the least amount of unforeseen issues. For more information or guidance on how to best proceed with your mortgage loan application, contact me today! Kevin Berju, Branch manager AFN. www.phillymortgageteam.com 215-681-3587



Article Written By: Kevin Berju, Branch Manager AFN, www.PhillyMortgageTeam.com

American Financial Network NMLS # 137213





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Kevin Berju starts Philly Mortgage Team with over 25 years in the mortgage industry. Prior to working with residential and commercial mortgages, Kevin graduated with a business degree from Temple University, owned his own business, and worked as an agent for years in both commercial & residential Real Estate. With Kevin’s diverse knowledge of the real estate and mortgage industries, his clients are thoroughly guided throughout their home buying or refinance process. As a result of his knowledge, attention to detail, responsiveness to his clients, and exceptional work ethic, Kevin was awarded the Five Star Mortgage Professional recognition in Philadelphia Magazine for the past successive years as well as reaching the top 1% of all originators country wide since 2012 as designated by Mortgage Executive magazine.

As a mortgage professional for over 2 decades, Kevin is an invaluable resource for both first-time and experienced home buyers. With his accomplishment of the Certified Mortgage Planning Specialist designation, Kevin is placed in an elite group of the top 5% of mortgage professionals in the industry. Looking to Purchase or Refinance in Pennsylvania, New Jersey, or Florida? Kevin Berju is the Lender for You!


Venture Philly Group

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info@venturephilly.com

o. 215.592.9522

604 S Washington Square, Philadelphia, PA

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