We often talk about how crucial a mortgage pre-approval is when you’re ready to make a real estate move. Although pre-approvals are necessary in a competitive real estate market, buyers must remember that a mortgage pre-approval doesn’t guarantee that everything will proceed without a hitch.
Once you get your pre-approval letter in hand, there are some things you can do to avoid delays in the loan process. Here are the dos and don’ts we recommend:
- DO work with an experienced real estate agent.
A real estate agent who understands the local real estate market will help you find homes within your pre-approval budget that check off most of the items on your wish list. - DO plan for all homebuying costs.
In addition to your down payment, you’ll need to consider closing costs, moving costs, and the price of any home improvement projects you’ll want to accomplish after you take the keys to your new home. - DO communicate with your lender.
When you find a home you love, tell your lender so they can update your mortgage file and get a better idea of your expected monthly payment. - DON’T make big purchases during the mortgage process.
If your spending goes up, your pre-approval amount might go down, so avoid significant purchases until the mortgage process is behind you. - DON’T make a large deposit into your account without documenting it.
While many mortgages allow financial gifts to cover the down payment, this requires thorough recordkeeping. Document all deposits to avoid delays in your official approval. - DON’T make a major career move.
Since mortgage approval is usually based on your two-year employment history, changing jobs in the middle of the mortgage process could lead to frustrating closing delays. - DON’T miss payments, especially on your current mortgage.
Missing payments on your current mortgage—or anything, for that matter—might cause your credit score to dip, affecting your mortgage approval. - DON’T make an impulsive homebuying decision.
Although pre-approvals do expire, it’s much better to renew yours than to make a life-changing decision that you feel lukewarm about. - DO enjoy the process!
Buying a home is an exciting time. Remember to compartmentalize the stress and enjoy the moment on occasion!
Are you worried about making a misstep during the mortgage process? Contact MortgageDepot today to learn more about how to preserve your pre-approval.
Connect with one of our loan consultants to learn more.
