The Top 4 Ways to Have a Smooth Mortgage Closing - After you’ve found the home of your dreams, the last thing you want is to have some sort of issue pop up right at the end that could prevent you from closing your mortgage – and, ultimately, that could prevent you from moving into your new home. Having delays in the mortgage process is not only a headache, but if there are multiple offers on the home, there is a chance you could lose the house to another buyer! Luckily, by following these 4 tips, you can prevent any last-minute curveballs that might cause added stress when it comes time to close on your mortgage:
1. Care for your credit
Some people mistakenly assume that once they are originally approved for a loan, they are in the clear credit-wise. But anything that you do to change your credit score can change your mortgage rate up until the day you close! Until the loan is completed, you are still at risk to have an increased interest rate – or be disqualified completely – if you do something dramatic enough to affect your credit rating or to affect your debt-to-income ratio.
For example, buying a new car, co-signing on a loan for a family member, taking out a personal loan, missing a payment, or defaulting on a loan could all cause trouble during your mortgage closing. So, when you’re in the middle of purchasing a new home, take extra steps to make sure there aren’t any big purchases in the near future that might lower your credit score. (Even buying lots of furniture for your new home and putting it all on your credit card can be a red flag!)
2. Keep your income consistent
Although many times changing jobs is not something you can control, if at all possible, do not change jobs during the mortgage process. Banks like to see consistency in your employment history, and they put more faith in longevity to ensure a steady income. Changing jobs during the process – even if your new job comes with a bigger paycheck – can hold up the closing process. If you can help it, try not to purchase a new home when you are new to a job, since banks like to see consistency in your work. In fact, your interest rate is more likely to be lower if you have been at your current job for over two years.
3. Do a final walk-through
Finalizing a mortgage is not an easy process, so it’s important to make sure that everything is in order in the home itself in order to avoid any issues that may affect the closing of the mortgage. Make sure that any requests you have made have been properly addressed, and that everything is in order on the seller’s part for the home before you finalize your mortgage.
4. Keep all of your paperwork safe
The mortgage process will come with tons of paperwork, and whatever you do, don’t lose any of it! If you do, not only can it push back the closing of your home, but it can also end up costing you money.
Although it’s difficult to avoid all stress when purchasing a new home, by following these steps, you can make the process as easy as possible. And, by working with a realtor and a lender that you trust, you can avoid last-minute disasters that can prevent you from purchasing your dream home!
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