3 Mistakes That Can Kill Your Mortgage Before Closing

Transcript

Lightly edited from the video for readability.

Hi. I'm Matt Demorest, the owner of HomeSure Lending. We're going to talk about common mistakes that you want to avoid during the mortgage process. One of the main mistakes that people make during the loan process is trying to open new credit during the process. Now when you're buying a house, you know, maybe you need appliances, maybe you need furniture, there are things that you're going to need for that house.

Even refinancing, you're going to be saving money, so it could be tempting to spend some of that savings in a different way. But the problem is, when you go to open a new credit card at Lowe's or Art Van to buy furniture, that's going to impact your credit score. Anytime you have your credit pulled, your score goes down. The score is going to get checked again before the loan closes and when the score goes down, it could impact our ability to close. On top of that, we've qualified you with a specific debt to income ratio and that means your monthly payments versus the money coming in from your income.

If that ratio changes, you may not qualify for the program that we initially qualified you for, meaning we may not be able to close. So it's really important if you're going to open a new credit to come and talk to me and make sure how it may have an impact on your ability to finance your property. The 2nd mistake that people make is changing or leaving a job during a loan process. We all have things come up and so you may be interviewing for position and have gotten a job that's a much better opportunity for you and that's great news, but ultimately on a new job it's difficult to close a loan. So while the loan is in process, if you're trying to buy a house, it's very, very important to stick at the job you have.

The last few days of the loan process, what's going to happen is somebody's going to get on the phone and call your employer and say, are they still here? We've already verified your income, your W-2s, and your pay stubs to make sure that you have the income we need, but there is going to be a phone call within 3 days of closing to say, are they still here? Very important to understand that changing or leaving your job before the ink is dry and the paperwork can impact your ability to buy the house. The 3rd most common mistake that people make during the loan process are large deposits into their bank account. Any deposit over 25 percent of your monthly income, so if you make 4000 dollars a month, that would be 1000 dollars.

Any deposit over that amount is going to need to be fully documented. The reason for it are federal anti money laundering laws. Federal anti money laundering laws require us as lenders to scrutinize the documents that come in to make sure that people are not laundering money through buying houses. So if if you have cash sitting at home, it really needs to go into the bank and be in there and seasoned for 60 days. It can't show as a large deposit on your bank statement.

So we're going to have to wait till we have 2 months of bank statements where the cash has been seasoned. Also, gifts from family members, there are some really specific rules on that, so make sure you watch the video on getting a gift and buying a home. That's in our video library at homesurelending dot com slash faq. But it's very, very important if you have money sitting around to document it. Now if you get a pay stub or a bonus, a lot of people are like, hey, what about this bonus?

I've got 4200 dollars coming in. Totally fine. You just need a paper trail. You can sell a vehicle for 11000 dollars and deposit that money, but you need a bill of sale. So anything where you're thinking about, am I going to need to document that, just ask and we'll tell you how.

Ultimately, we're here to help you get to the finish line and all of these can be avoided if you just come to us and let us assist you in the ways that we need to document or get past any issues. We're here to work for you and we can only do that if you reach out. So give us a call, we're really happy to help you purchase with confidence and refinance with ease.