The Ten Commandments When Applying for a Real Estate Loan

 If you are applying for a loan to purchase a home, it's VERY important to adhere to these "10 Commandments":

1.                   Thou shalt not change jobs, become self-employed or quit your job. Job consistency and security are crucial.

2.                   Thou shalt not buy a car, truck, van, boat, etc. before closing. Any big changes to your income vs. debt ratio may negatively affect your credit and the loan you thought you had may no longer qualify for.

3.                   Thou shalt not use charge cards excessively or let your accounts fall behind. These factors affect your credit score. The higher the credit score the better.

4.                   Thou shalt not spend money you have set aside for closing. Work with your agent and lender to mitigate the closing costs and make sure you have the funds for a successful closing.

5.                   Thou shalt not omit debts or liabilities from your loan application. In other words, put all your cards on the table. The truth will come out in the many background and credit checks that are done.

6.                   Thou shalt not buy furniture (or appliances). This is similar to #2. These purchases may lower you credit score and affect your interest rate or even nullify your loan.

7.                   Thou shalt not originate any inquiries into your credit. Too many inquiries may negatively affect your credit score.

8.                   Thou shalt not make large deposits without first checking with your loan officer. All large deposits need to be explained and verified.

9.                   Thou shalt not change bank accounts. It creates a paperwork nightmare. Also some banks put holds on deposits and you need to make sure you have your money for closing.

10.               Thou shalt not co-sign a loan for anyone. A co-signed loan is the same as your loan and will appear on your credit report.

By contacting one of our excellent agents at and following these rules you’ll be well on your way to a smooth and successful closing.

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