Closing on Your House – Avoid These Mistakes


Closing time approaching. It’s so exciting. Everything is going so well. Well, to keep it going well, the pre-closing time requires careful planning and avoiding common pitfalls that could jeopardize your mortgage approval.

Pre-Closing Don’ts

Credit stability
Maintaining credit stability involves more than avoiding new credit cards or loans. It also means refraining from closing existing credit accounts, as this can negatively impact your credit score. Additionally, avoid making large purchases or transferring large sums of money between accounts, as these activities can raise red flags for lenders.

Paying bills on time
Paying bills on time is not only crucial for maintaining a good credit score but also for demonstrating financial responsibility to lenders. Late payments can stay on your credit report for up to seven years and can significantly lower your credit score.

Stable financial behavior
Avoiding major purchases extends beyond new cars or credit cards. It also includes large expenses that could deplete your savings or increase your debt-to-income ratio. Lenders want to see stable financial behavior leading up to closing, so it’s essential to maintain your current financial status.

Communicate and Respond

Staying in touch with your lender throughout the pre-closing period is vital. If there are any changes in your employment status or income, inform your lender immediately. Changes in financial circumstances can impact your loan approval, so transparency is key. Responding promptly to your lender’s requests for additional documentation or information is also crucial. Delays in providing necessary documents can prolong the pre-closing process and may even lead to a loan denial.

Staying in contact with your loan officer allows you to address any concerns or questions that arise during the pre-closing phase. Your loan officer can guide how certain financial decisions may impact your mortgage approval and help you navigate any challenges that arise.

Keeping an open line of communication with your loan officer is the best way to ensure a smooth closing process. Regular updates and clear communication help build trust between you and your lender, making the entire home-buying experience more manageable and less stressful. You can learn more about the closing process also here, or by contacting us.

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