Just moving cash from one bank to another can create a major glitch in the mortgage application process. Below are some other common areas that require special attention during the processing of your mortgage loan:
Try not to move cash around. During the loan application process, First Home Mortgage will have to verify all assets listed as part of your application. Moving these assets around can create a paper trail nightmare. The best advice is to leave everything where it is and discuss any changes with me.
Document large deposits. All sources of funds for the transaction will need to be verified. We’ll be looking at any large deposits into your asset accounts (checking, savings, money market, etc.). You should be prepared to document all sources — perhaps a copy of a paycheck, bonus check, money from the sale of an asset, etc.
Selling something? If you’re selling a large asset, such as a car, antique, baseball card collection to come up with the cash for closing, please document the sale. Keep copies of everything, including the check the buyer gives you, car title or a bill of sale. Sometimes you’ll even need to get a certified appraisal of the item.
Document gifts appropriately. Large cash gifts from relatives are very common when purchasing a home. If you’re anticipating receiving a cash gift from a relative toward the purchase of your home, notify me.
Save everything! Become a paper hound. Keep all of your bank statements, pay stubs, tax returns, along with any W-2s, 1099s or K-1s and any other financial papers from the past two years in a handy place. If you sold a home in the past two years, have your (HUD-1) Settlement Sheet handy. Try to create a file where you can consolidate all of your financial paperwork for easy access. When in doubt, just pop it in the folder. You never know!
Avoid new lines of credit. It is a good idea to avoid any new sources of credit as it will materially change your credit report. Additionally, if you’re planning to pay off major credit debt before closing, hold off until you’ve spoken with me. We may be able to pay off those debts at closing without affecting the application process.
Avoid buying large ticket items and increasing credit card debt. Your credit will be run again prior to closing. Any new debt or increase in your monthly payment on your credit card debt could affect your loan. Please call me before you buy.
Tell us about a new job. Making a career move? Make sure you let me know about it as soon as possible so that we can ensure all appropriate changes are made to the loan application.
In summary, speak with me if you anticipate making any significant changes to your financial picture prior to closing on your loan. Things you think aren’t a big deal could make a big difference in settling smoothly. We will do everything possible to ensure the process is easy, convenient and stress free!
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