How to go from “approved” to “unapproved”!

Once you get your mortgage approval, everything is good, right??  NO!  Mortgage approval is still based on the three areas of credit, income and equity.  However now more than ever, it can be very easy to go from approved to denied.

There are basic rules you need to follow if you are buying a new home or refinancing your current home.  In a typical market, it will take roughly three weeks for your mortgage to go from start to finish.  However, in a busy refinance market, it may take 6 weeks or longer if you need a second mortgage subordinated or the appraisal has problems.  If you are buying a foreclosure or a short sale, it may take longer – up to six months for the bank to issue a short sale approval.  During that time, you may have changes that can affect your mortgage approval.

Make sure that you follow the basics:

  • Don't buy a new car or trade up a lease to a more expensive lease
  • Don't quit your job to switch industries or to a start a new company
  • Don't switch from a salaried position to a commission based position
  • Don't transfer large sums of money between accounts
  • Don't forget to pay your bills
  • Dont open new credit cards
  • Don't accept a cash gift – if you are getting a gift, make sure it's documented
  • Don't make random undocumented deposits into your bank account

Remember that your lender will verify your employment and your credit report just before closing.  If there has been a change, you may no longer qualify for your loan.  If you know you are going to change employment or you need to make a large purchase, make sure your lender is aware of it before you do it.

The guidelines above are a good start to making sure you keep your mortgage approval.  If something happens, talk to your loan officer right away!  Maybe there is a way to keep your approval – but  you don't want to wait until a day before closing!!

Leslie Vanderwerf,  NMLS ID#335509, Advisors Mortgage - EmailWebsite

 

Written By

Currently a Senior Loan Officer at Cross Country Mortgage LLC, it's hard to believe I have been in the mortgage business for more than 25 years and have worked with Sharlene since 2000! I love sharing mortgage insights here each week and helping people finance their homes. Listening helps me find the right program for you!

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