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The Last Minute Credit Check
24 Hour Recorded Information with
more
on Staying Approved for Your Loan:
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ext. 6689
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More FREE Buyers Recordings:
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"Avoid 10 Common Potentially Devastating Mistakes
First Time Home Buyers Make."
1-800-741-8634 ext. 6119
"How To Stop Paying Rent Forever And Own a Home Of
Your Own!"
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Secrets Lenders Don’t Want You to Know! Read This
11-Point Report Before You Sign Anything!
1-800-741-8634 ext. 6419
“Hiring A Real Estate Agent”
1-800-741-8634 ext. 6109 |
Your actions after receiving lender approval for a
mortgage loan can disqualify you for the loan. A
mortgage loan is conditionally approved, with the
lender reserving the right to re-verify credit,
income, assets and employment at anytime. The lender
may cancel the loan if there are any adverse changes
to your qualification status. Did
You Know?
Your mortgage lender may run a second credit report
just prior to closing. Red flags that appear in this
credit report can disqualify you for the mortgage
loan.
Debt-to-Income Ratio
Your debt-to-income ratio is your gross monthly
income divided by the amount you spend on debt. Debt
items include mortgage payments (including
principal, interest, insurance, tax), car payments,
credit card payments, student loans, child support
payments, etc.
The lender considers debt-to-income ratio when
approving you for a mortgage loan. Only 28 percent
of your income can be used for your mortgage
payment, which includes taxes and insurance; and 36
percent for the mortgage payment plus the rest of
your debt. Anything you do to negatively affect your
debt-to-income ratio may change an "approval" to a
"disqualification."
Avoid Red Flags
A red flag is any inquiry made regarding your credit
worthiness. If you decide to purchase a big ticket
item - like a car, boat or furniture - prior to
closing, you're at risk of having a red flag show up
on your credit report.
Keep Your Money Where It Is
The balances of your liquid assets are considered
when approving you for a mortgage loan. These liquid
assets may include checking accounts, savings
accounts, certificates of deposit, money market
accounts, retirement accounts, stock and mutual
funds.
Avoid changes to the balances of these accounts. Do
not close accounts. Do not change banks. A large
withdrawal or deposit to any of these accounts will
trigger a red flag for your mortgage lender. If a
red flag is triggered, you may be asked to produce a
paper trail tracking large withdrawals and/or
deposits.
Employment Status
For most employees a change of jobs to one of equal
or higher pay will not trigger a red flag. However,
sales people should not change jobs prior to closing
on their mortgage loan.
Salaried Employees
If your income is strictly salary than you should
not have a problem changing to another job of equal
or greater income. If, however, your income includes
salary and bonuses, commissions and/or overtime, you
should not change jobs prior to closing.
Hourly Employees
If your income is based solely on a 40-hour work
week without overtime, than changing to a job with
equal or greater hourly pay should not be a problem.
However, if your income is dependent upon overtime
pay, do not change jobs prior to closing.
Commissioned Employees
If your income is from commission or a substantial
portion of your income is from commission, then you
should not change jobs prior to closing. Typically,
mortgage lenders average your commissions over the
last two year period to determine income. Changing
employers eliminates the two-year commission history
and places uncertainty on your income status.
Talk to Your Loan Originator
Do not make any changes to your financial and
employment status without first talking to your loan
originator.
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