Mortgage Mistakes

December 10, 2008
Matt Isleib

 

There are some no-no’s that you need to avoid when seeking out your mortgage. If you are purchasing a home for the first time or even looking to refinance your existing mortgage here are some things to take seriously:

 - This statistic is overwhelming, do not buy a car while you are applying for a mortgage on that new home. It potentially could come back to haunt you. The stats are somewhere around 1 in 3 will buy a new car around the same time they are buying a home. Buy the car after you have closed on that new home.

 - Avoid making large purchases on your credit cards during your mortgage application process. Buy that new furniture set after you close.

 -If you are contemplating what to do if you have run yourself into a lot of credit card debt, one thing to avoid like the plague is credit counseling. It will drop your FICO score and some lenders will not lend to individuals who are in credit counseling.

 -Avoid bankruptcy and foreclosure for obvious reasons.

 -Avoid late payments on your credit cards. If at all possible never make your payment 30 days past the due date.

 -Avoid mortgage lates. If you are trying to refinance and have late payments on your existing mortgage you will have an uphill battle. Your mortgage is due the first of each month, you have a grace period typically till around the 15th of the month after which you may have to pay a late fee. Do what you can to ensure that your payment is received by your lender within 30 days of the due date. Your credit score will not be affected if you send your payment to your lender after the 15th but make that payment on the 31st of the month rest assured it is going to affect your credit score.

 -Avoid listing your property for sale and then try to refinance. Odds are you will not be able to refinance with most lenders.

 -Always get two opinions. If you are refinancing or buying get two rate quotes, never assume that the one person you call is the one with the best rate you may be able to do a  little better.

 -Always I mean always tell your mortgage broker if anything arises during your mortgage application. I cannot begin to tell you how many times borrowers have changed jobs during the process and never mentioned it. The majority of the time the consumer assumes that it is not a big deal, it is so make a point to mention it.

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