HOME FINANCING PROGRAMS OVERVIEW
Many types of home financing programs are available. Here’s an overview to help you get started.
You’ve applied for a new home loan or have decided to refinance your existing mortgage. You’ve made a great choice, and much of the work is now done. You’ve researched loan options, talked through them with a licensed loan officer, gathered the required documentation, and completed your application.
Now all you have to do is wait, right? Not quite.
During the loan process, there are many factors that our loan processors and underwriters will review when considering you for a loan. Processors may request additional or updated documentation, and underwriters may need clarification on certain aspects of your finances. But that’s not all.
Beyond reviewing and requesting documentation on your financial history, we’ll also be paying attention to what you’re doing with your finances during this time. Just because the initial application is complete and our team has most (if not all) documentation required to review the loan, doesn’t mean that you can go finance a new suite of living room furniture or buy a new car.
Many of these things will affect your financial standing, such as your debt-to-income ratio and credit score. It’s important that these aspects remain consistent during the loan review process, otherwise the details of your loan could change. You may be required to provide a written explanation of your activity, or worse — your loan could be canceled.
So, how can you ensure that you don’t put your loan at risk?
Follow the Dos & Don’ts
We’re just as excited as you are about your new home or refinance. That’s why we’ve put together a list of things to do and not to do as you’re navigating the loan process. Not only will this information help you when your loan is being reviewed, but it will also help if you’re getting ready to apply.
What you should do:
- Complete your application thoroughly.
- Respond to questions and requests promptly. Additional requirements (known as loan conditions) may need to be cleared to help underwriters approve your loan.
- Disclose all other loans and credit. Be transparent with your loan officer so your application will not get held up.
- Be accessible as your closing date approaches. Schedule time to review and sign documents and pay closing costs and down payment.
What you should not do:
- Make any major purchases. This includes a new car, appliances, or furniture that may alter your debt-to-income ratio or negatively affect your ability to make monthly mortgage payments.
- Open any new lines of credit. This could also alter your debt-to-income ratio or harm your ability to qualify for a loan.
- Move money around in your accounts. This may appear as an attempt to hide debt or large balances.
- Use untraceable money. Using large amounts of untraceable cash can make it difficult to understand your spending habits and cash-flow.
- Make a career change. Maintaining your position until after your loan closes demonstrates income stability.
If you have questions, we have answers
This list is, of course, for guidance purposes only. Sometimes life throws curve balls that we have no choice but to address. We understand.
So, if you’re looking to buy or refinance and are unsure about one of these dos or don’ts, give me a call and I’ll be happy to discuss your situation and answer any questions you might have.
CrossCountry Mortgage, Inc. is an FHA Approved Lending Institution, and is not acting on behalf of or at the direction of HUD/FHA or the Federal government. All loans subject to underwriting approval. Certain restrictions apply. Certificate of Eligibility required for VA loans. CrossCountry Mortgage, Inc. is an FHA Approved Lending Institution, and is not acting on behalf of or at the direction of HUD/FHA or the Federal government. All loans subject to underwriting approval. Certain restrictions apply. Certificate of Eligibility required for VA loans. USDA Loans: Borrower income limited to 115% of median income for the area. Borrowers must have reasonable credit histories. 30-year loan term. Housing costs cannot exceed 29% of income; total debt payments cannot exceed 41% of income. Homes must meet state and HCFP building codes. Funding fee required. Available only in designated USDA rural areas.