There are many factors when any lender decides on the final approval of the funding of any mortgage loan. Here are five things that may shock you that could actually matter and make a big difference in order for the mortgage loan agreement to be stamped approved!.
- Don’t Close Any Accounts During the Mortgage Process – Since lenders are evaluating your present financial situation, the closing or canceling of any existing accounts, regardless of balance, may trigger a red flag with the lender. If you want to close any accounts or cancel any contracts, do this either before or after the mortgage loan application has been approved.
- Buy Life Insurance – Although life insurance is not a requirement for most mortgage lenders, it is definitely something that many lenders will take into consideration when evaluating your mortgage loan application. By demonstrating that you have enough life insurance to cover the mortgage, there is a higher likelihood that they will approve your application, because they know there is less of a chance they’ll have to go through the difficult process of handling your mortgage if you were to suddenly pass away.
- Request That Credit Bureaus DO NOT Accept Unauthorized Credit Checks – If you’re like many average Americans, you receive countless “pre-approved” credit card solicitations and loan ads in your mailbox every day. This is because these companies have software that scans consumer credit reports based on criteria that they feel will result in a list of good potential new customers. Although these inquiries may not directly lower your credit score, it does show up when a mortgage company pulls a copy of your report. Your best option is to prevent these companies from accessing your credit report altogether.
- Don’t Move Your Money From One Bank Account To Another – Any transfer of money from one account to another generates a paper trail that will require further explanation when the bank or mortgage loan company receives copies of your account statements. Even if the transfers are within your own accounts, try to avoid moving the money if at all possible. This is especially true when moving money from a savings account to a checking account because it may appear to the lender that you’re preparing to use that money.
- Avoid Using “Credit Repair” Services – Many people with credit that is less than perfect are attracted to organizations that offer to fix your credit in record time and improve your overall score. This is not always the case. When lenders see on your credit report that you are working with a consumer debt counseling company they actually look less favorably upon such notations. To the lender, the only way to interpret this information is to assume the borrower cannot pay the existing bills, therefore how could they possibly afford a mortgage loan payment? Your best bet is to work directly with the credit card or loan companies to arrange a repayment plan.