You are about to make the number one, largest purchase of your life: a home.
Once you’ve found your home, signed a contract, and secured a closing date is when you will come into contact with your loan processor. The loan processor is an extension of your loan officer and will work on preparing your file (filled with your credit story) to submit to an underwriter to review your file for a loan decision.
Three components make up your credit file: credit, income, and assets. These are the three pieces that depend on you to do your part. Keep an open line of communication with your loan officer on these items to prevent any possible hiccups. There are a lot of systems in place and if there are any changes, investors these days will find them. It is better to be pro-active than reactive.
- Credit – once you commit to shopping for a home, do not open new credit, do not spend the credit you have, and do not make any other major purchases (i.e. auto). These are the three things that could potentially hurt your credit AND compromise your home purchase. If you have any debt that is not showing on your credit report, let your loan officer/processor know as this could be a snafu down the line. You want to keep your credit status quo.
- Income – once your pre-approval has been issued (when you begin the home shopping phase), if there is any change to your income or job, you must notify your loan officer immediately. This is all part of the information we are required to verify and provide documentation to support the income being used to qualify you for your home loan. It is important to the process that we have the most up-to-date information to keep your transaction flowing smoothly.
- Assets – know how much money you need and make sure you have the appropriate funds in place. Whether it is your own funds (saved from pay day), a gift, or a 401k withdraw, have your funds in your checking/savings account a minimum of ten days prior to closing. Any large deposits that are not a direct deposit from payroll will need to be verified and accounted for. Depending on the amount of the deposit, there is some leniency on this, and your processor/loan officer will let you know. Also, if you have multiple accounts and you are moving money back and forth, everything will need to be clearly documented.
It can seem like a lot of work. However, with First Centennial Mortgage’s knowledgeable and professional team in place to guide you through the process, your home buying experience can be a pleasant one!