DO's and DON'Ts
While your Mortgage Loan is in Process…
Mortgage loans need to comply with lender guidelines, regulations
and the whims of loan underwriters. Therefore, it's important
to know up-front the things you should and should NOT be doing
while your loan is in process. Here are the most important things:
- Bank & other financial asset statements: Due
to Federal laws surrounding money laundering, lenders need
to track "where the money came from" for large deposits
made to the statements that you furnish to them. If a deposit
that is usually larger than a payroll deposit suddenly shows
up as a deposit to your account(s) on the statements you provide,
the lender will want to see a paper trail of "where the
money came from" (i.e., copy of the check, check stub,
letter or other documentation from the originating source).
Therefore:
- Keep a paper-trail of these deposits and provide this
documentation to your lender.
- Make sure your individual deposits are NOT an un-acceptable
deposit (un-secured cash advance on a Visa card or loan,
cash, etc.) - these are not acceptable as part of funds
needed for down payment, closing and prepaid costs for your
loan.
- Provide all pages of the asset statements. Lenders need
to track all deposits and all withdrawals.
- Check to be sure that your account balances show a beginning
and ending balance covering at least a 30 day period and
that they cover your most recent statement.
- If providing Internet statements, be sure that they have
your name on them and partial account number and that they
have the name of the company on them.
- If you anticipate receiving any money from sources other
than your payroll while your loan is in process, it would
be a good idea to call your lender so they can advise what
documentation will be needed.
- Employment: If you change employers, your lender
needs to be notified so that they can verify your current
employment. Provide them with the name, address, and phone
number of your new employer. They will also need a copy of
your first pay stub from your new employer before your loan
can close.
- Do NOT change employers without first advising your lender
and seeing if the change of employment/employers will affect
your mortgage loan.
- Do NOT get laid-off, quit work, or decrease your work
hours.
- Make sure your pay stub has your current earnings as well
as year-to-date earnings showing on it, as well as the name
of your employer printed on it.
- Credit: If you anticipate purchasing additional items
on credit which will increase your monthly debt obligations
or will otherwise affect your credit, your lender needs to
be notified. If your credit report needs to be updated with
this new information, it may affect the underwriting of your
loan.
- Do NOT make additional large purchases until after your
loan closes.
- Do NOT apply for new credit cards or purchase other items
on credit, even items which offer deferred payments.
- Do NOT make any late payments on any of your accounts.
- Do NOT allow any items you dispute become collections,
charge-off's or other derogatory information on your credit
report.
- Other Changes to your Life: If any of these events
occur, please advise your lender.
- If you plan on a divorce or separation.
- If you begin receiving child support or alimony payments
or expect to.
- If you plan on filing for bankruptcy, foreclosure or become
involved in a lawsuit or other litigation.
While you may agree that most of these items are "common
sense", it never hurts to review the list just to be sure
that purchasing your new home (one of the largest purchases
of your entire life) will go smoothly.
|