Monday, November 18, 2013 / by William Culp
Applying for a mortgage can be a daunting task. It takes many hours, lots of paperwork, and possibly a headache or two. Below are several mistakes to avoid when on the hunt for a mortgage.
Not checking your credit. This should be your first step in applying for a mortgage. Check your score months before applying for a mortgage so you know where you stand, and have time to make any changes if necessary.
Not getting pre-approved. A mortgage pre-approval is one of the best things you can do to ease the home-buying process. During pre-approval, your bank checks your credit and examines your income, assets, and employment. Before shopping for a home, get pre-approved. Many sellers won't take you seriously otherwise.
Applying for new credit AND a new mortgage. Do not apply for a new line of credit before or during the mortgage application process – it hints at financial instability, and you're seen as a greater risk.
Changing jobs. If you're thinking about switching jobs, then hold off on the mortgage application, or stick out your current position for longer. While a change in the same field doesn't necessarily mean you will be rejected, a big change - like a brand new career - can be a red flag.
Not seasoning your assets. Uncle John is giving you $10,000 to put toward your mortgage? Terrific. Make sure it's in your account months before you apply for a mortgage. New funds do not equate to financial stability, and your underwriter will catch on.
As a Member of the Top 5 in Real Estate Network®, our team has a wealth of real estate and home ownership information that may be of help to you. Feel free to contact us any time to learn more about this important information, and be sure to forward this article on to any friends or family that may be interested as well.