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Applying for a mortgage requires a lot of paperwork. A single mistake before your loan gets approved could create delays and require even more paperwork. Credit.com highlights several factors that can slow down your approval.
After closing on my home and securing final mortgage approval, I thought it was fine to apply for a credit card I’d been eyeing for reward points. I was mistaken—my mortgage lender reached out right away asking why I opened the card and demanded a written explanation, even though I hadn’t even activated it yet!
Credit.com also mentions other factors that could cause delays. While applying for another loan or credit line is a clear culprit, other situations like large deposits or new sources of income can also delay things. They offer a few tips to help prevent hold-ups:
Monitor Your Spending:
It’s not the time to purchase new furniture or a car to complement your new home. Lenders track your credit usage during the mortgage application, and increasing your balances could hurt your chances of approval...
Avoid Changing Jobs & Consider Delaying a Promotion:
Starting a new job, becoming self-employed, or even accepting a promotion that offers a lower base salary but higher commission might jeopardize your mortgage approval, Lewis explained. “Most loan types require a two-year history of commissions, bonuses, or overtime,” Lewis added.
Limit Your Cash Deposits:
You may think that inflating your bank balance is a good move before applying for a mortgage, but if you do so, avoid using cash. Any large deposit must have a verifiable source, and cash deposits can seem suspicious...
The mortgage process can be delicate, so it’s important to understand what actions might trigger red flags with your lender. For more detailed information, check out Credit.com’s full article at the link below.
Photo by Cameron Parkins
