Are you thinking of buying a home? If so, check out our lists of financial Do’s and Don’ts to help you prepare!
Do:
- continue to make payments on time for current mortgages, cars, credit cards, etc.
- keep a paper trail, document, and explain any large or unusual deposits or withdrawals into accounts (checking, savings, stock, etc.).
- keep pay stubs, bank statements, tax forms, etc., in case the lender needs to update the documentation prior to closing.
- ask questions if something is unclear about the loan program, fees, and/or loan conditions.
- let the loan officer or mortgage broker know if anything changes. For example; employment, income, assets, credit history, etc.
- document that the earnest money deposit has cleared your account — obtain a copy of the canceled check and/or the statement that reflects the funds have cleared.
- lock in the interest rate, have the homeowner’s insurance agent information available, and provide updated documentation (pay stubs, bank statements, etc.) in a timely manner so as not to delay the closing.
Don't:
- increase credit card balances and/or loan balances.
- apply for additional or new credit or put balances on a paid credit card.
- ignore late payment and/or collection notices that are received during the mortgage process.
- purchase anything that is “same as cash” — it will show on the credit report as a new debt.
- buy furniture, cars, or appliances on credit until after closing.
- lend money to family members, friends, etc. if it is needed for closing.
- store money at home, and place it in a bank account so it can be documented as savings throughout the loan process and can qualify as assets on hand.
- have overdrafts on a checking account.
- quit or change jobs during the loan process.
