Lowest Mortgage Rates Special Report On The Top 10 Things You Should Avoid Doing While Being Approved For A Home Loan

Armed with the right knowledge, homebuyers can get better rates on mortgages – and can have a better experience when finding the home loan they need. Smart homebuyers can use Lowest Mortgage Rates' premier lender match to get the facts about mortgages. The matching service helps you get the best deal, and there are some specific things you can do during the application process before you are approved to ensure the best deals. Lowest Mortgage Rates has some great advice about what to do – and what to avoid – before closing.


The first thing that customers need to watch out for is making any major financial changes before applying for a home loan. Changes can affect a credit rating and so can affect mortgage rates. Lenders want to see stability so that they can be sure that the money they lend will be paid back. The simpler the paper trail and the more stable your employment and financial history, the more likely it is that lenders will respond well to your application. Even minor changes, such as switching banks during a loan application process, can mean higher rates, so applicants do need to be careful.


Our number one tip that we give loan applicants is to watch employment history. It's important not to change jobs just before or during the loan application process, as this makes lenders pretty nervous. Most lenders want to see at least a 24-month history of work, preferably with the same employer. Many lenders call the applicant at work the day before closing to make sure that the applicant is still working at the same job. It's a little secret that is simply not often shared with the applicant, but knowing this and holding onto that job for just a little longer can make all the difference. In fact, at Lowest Mortgage Rates we suggest that loan applicants avoid any major financial or life changes between starting a loan application and closing. During this period, anything the applicant does can still affect their loan.


Number 2: You should avoid any sudden financial changes. This means not opening any new store cards, any new bank accounts or any new credit or loan accounts. New credit -- even small new accounts – can potentially lower your credit score and make you less attractive to lenders. On a related note, it is also equally important not to close down any credit accounts before applying for a home loan, since old credit accounts establish credit history. Paying down debts can be a help, but keep those accounts open, Lowest Mortgage Rates advises homebuyers.


Number 3: Loan applicants should understand how credit works -- and how they can improve their credit before they apply for a mortgage. Credit scores are most affected by late payments on bills. Whether you are paying your phone bill or car payment, Lowest Mortgage Rates advises that you pay on time and pay at least the minimum required. Paying on time can mean a better credit rating and a good mortgage rate.


Number 4: Keeping lines of communication open with a mortgage consultant or loan officer is key during the application process. These professionals can steer loan applicants in the right direction and can ensure that applicants don't do anything that decreases their chances of approval.


Number 5: At Lowest Mortgage Rates, we tell loan applicants to carefully read and ask about lenders requirements. Even mortgage pre-approval does not mean the loan application is over. The lender will ask for certain things -- such as W2s, employment records, bank statements, and other information. It's very important to get these in on time, even if you have been pre-approved.


Number 6: You can take the danger out of the contingency period. If you find a house you like, you will need to make an offer that comes with several contingencies. This means that until you close on the home, certain conditions must be met. Contingencies may include finding financing, getting an inspection, and so on. Homebuyers will be expected to put down a deposit to show the seller good faith. If the contingency period comes to a close without all the agreed-upon agreements being met, the homeowner could lose their deposit. Homeowners should take care to secure financing first during the contingency period, since the loan application will take some time. Be careful about spending money on appraisals and home inspections until you have your funding buttoned up; if you can't easily get funding at the rates you want, you don't want to spend extra cash on inspections and assessments.


Number 7: Applicants can improve their mortgage experience by stopping all comparison shopping with other lenders once they have applied for a loan. Any credit checks after the application process can still drive down your credit and can disqualify you for a loan. Lowest Mortgage Rates often sees a common problem: loan applicants will sometimes apply for new home loans, home equity loans, store cards or "buy now, pay later" deals at furniture stores because they are already thinking ahead to furnishing their new home. Sadly, having these lenders check your credit can drive down your credit and can cost you that mortgage or low interest rate.


Number 8: Homeowners should avoid applying for consumer credit counseling, bankruptcy, or other forms of help just after applying for a mortgage. These are red flags to lenders that you cannot pay your debts, and will cost you your home loan.


Number 9: Homeowners should look for undisclosed liabilities when buying a home. Lowest Mortgage Rates suggests that homeowners look out for any problems, including any legal claims against a property that may make it difficult to own the home free and clear. Looking out for these problems and getting any liabilities in writing can help homebuyers get out of a bad deal.


Number 10: Lowest Mortgage Rates advises homebuyers to take their time with closing. Taking the time to look over paperwork, taking the time to get advice, and taking the time to look out for hidden fees can help homeowners make the right decisions. Buying a home can be hectic, but moving methodically through the process helps homeowners avoid extra hassles.


The bottom line is that loan applicants should sit tight. In the months leading up to the loan and up to the time of closing, any new charges, expenses, and financial changes should be avoided. Even putting off movers, contractors, and other workers for the new home until a few days after closing can help borrowers get the best interest rates on their mortgage. Lowest Mortgage Rates can help homeowners like you get matches up with the right mortgage, so if you are still shopping around for the best financing, try our premier lender match and avoid some of the common pitfalls of buying a property.



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