The first time you apply for a mortgage loan in the Greater Boston Area you may make a few mistakes – that’s understandable. However, those mistakes might come back to haunt you in the future. An easy way to rectify it is to learn about the most common mistakes, & ensure that you do not make the same ones.
Common First Time Mortgage Loan Applicant Mistakes
- Non-Seasoning Of Assets: As the name suggests, mortgage loan lenders require that all assets should have been with you a certain period of time (at least a period greater than two months). This shows the lender that you are serious about buying a new house, that you have a tendency to save your money (both characteristics are considered important, characteristics that usually help your application to be accepted). Some first time applicants try to fudge on this by transferring a large sum of money from their friends or relatives into their account while initially applying for the loan/ closing the loan. Do not make this mistake, lenders will move through your financials thoroughly, ask you to explain the source of any large deposits made within a short time span of applying the loan.
- Applying For Other Sources of Credit: Many first time applicants tend to apply for many sources of credit simultaneously. For example, they will purchase both a car and a house at the same time. However if the lender sees that you have accepted another source of credit, the risk associated with lending you money will increase. This might even cause a rejection of your mortgage loan application in Greater Boston. So focus on the house first, everything else you can get after.
- Changing Jobs: Lenders like applicants who have a stable source of revenue. If you suddenly change job while applying for a Boston mortgage loan, this will reflect badly on your application. While a change within the same field is not considered bad, if you decide to change your stream entirely, hold off until you finalize and sign the deal with your lender.
- Continuously Shopping For The Lowest Rates: The only thing constant about mortgage loan rates is that it changes continuously. Sometime rates change many times within the same day. So continuously trying to find a rate that is the lowest is a waste of your time. Once you find a rate that is good enough for you, lock it and go ahead with the process.
- Not Getting Written Proof For The Locked In Rate: Verbal agreements mean very little when it comes to mortgage loans. So, once you find a rate that you like, lock it in (meaning that the rate you lock is guaranteed for a certain number of days) and get a written agreement from your mortgage loan lender.
- Not Reading The Documents: No matter how boring you find the loan related documents, make sure to read every line before signing it. This will ensure that nothing comes back to haunt you in the future. If you find that you do not understand something, ask your lender to explain it.