Things To Know About Pre-Approval And Finalizing Your Mortgage
If you've been thinking about buying a home, you may have reached out to a local mortgage lender about pre-approval. Many people believe that a mortgage pre-approval means that they're locked in and they don't have to worry about anything. Unfortunately, that isn't necessarily the case. As a prospective homeowner, it's important for you to understand that there are some things that could ultimately cost you that pre-approval and, ultimately, the home you wanted to buy. Here are some things that you need to know.
Don't Change Anything At Work
If you're getting ready to buy a house, this is not the time for you to change jobs, accept a promotion, or even take a raise. That's because your mortgage lender won't validate much of your income information directly until the final underwriting. And, it's important to remember that your lender wants to see consistency in that income, so don't change anything.
You might think that taking a promotion or a raise would reflect well, but it's going to set you back because your lender will want to see some time behind you at that new pay rate or in that new position before they agree to finance your home.
Don't Make Any Big Purchases
Whether you've been eyeing a car at the local dealership or you are impulsively shopping for furniture for that new house before you even close, you may accidentally cost yourself the mortgage. Taking on new debts or making big purchases will affect your debt-to-income ratio or the balance of your bank account and your spending history. All of these things are important factors for finalizing your mortgage, and changing any of them could ultimately cost you your final mortgage approval.
Don't Miss Any Payments
Whether you're dealing with credit card payments, loans, or any other financial responsibilities, make sure that you're making all of your payments on time while you wait for the loan to close. One missed or late payment could cost you the final approval on your mortgage because of its effect on your credit. Prioritize timely payments for all of your accounts so that you preserve your credit rating.
These are some of the most important things you should know if you're trying to finalize a mortgage loan and buy a house. The more you understand about the process and what can affect your approval, the easier it is to protect your pre-approval and get to the closing table without a hitch. Contact mortgage services near you to learn more.