St Louis Home Loan: Protect Your Loan Closing From These 3 Things

Your family has located the home of their dreams. You have your lending already taken care of and so you move ahead with signing a contract. But to your chagrin, you find out there will be delays at the closing table and wonder why is this happening to you?

In many cases, you may have changed your “borrower circumstances” between the day you applied for that St Louis home loan and the day you were suppose to close.

Due to the mortgage fiasco that has put this country into a deep recession, banks and mortgage lenders have gotten stricter as for as their requirements for lending.

Fannie Mae has been no exception to this rule. This mortgage behemoth’s ‘Loan Quality Initiative,’ which went into effect June 1, requires all lenders to closely follow “changes in borrower circumstances” between the time of the initial application and closing.

This could inevitably mean delays at the closing table due to this rigorous and time consuming enforcement which was enacted to protect the FHA and of course banks.

“Any change in circumstance could affect and delay a borrower’s closing on a transaction,” so says David Adamo, the CEO of Luxury Mortgage of Stamford.

So, here are 3 areas where a borrower could really mess up their current or next home mortgage closing:

1. Credit cards being maxed to the hill

When you are waiting to close on your new home, leave the credit cards at home. Going out and charging up credit cards is another guaranteed way of messing up your smooth closing. Consider paying cash until everything is finished with your mortgage closing.

Keep in mind that St Louis loans are approved based on your current debt-to-income ratio. Lenders take a close look at your debt payments compared to your income. If this debt is too high, your chances of being approved go down considerably.

Since lenders now re-check your debt-to-income ratios prior to closing, make sure you do not commit any of these mistakes otherwise you may not be getting good news at the closing table.

The best advice to all home owners is wait out those buyer cravings until you are done at the closing table.

2. Applying for or getting a new credit card or auto loan

If you really want to ruin your chances of a smooth mortgage closing, simply go out and make one of the biggest and unintelligent mistakes many borrowers make and that is getting a new credit card or auto loan especially without discussing this with your loan officer or banker.

Fannie Mae will certainly go over past documents and when they discover the undisclosed auto loan, the lender who made the loan will have to buy it back as a bad mortgage and thus lose money.

To make sure that the consumer is not financially negligent, the bank will do a last minute credit check to see that everything is still in order with you finances. Any changes and your home loan application will be denied.

3. Changing your employment

If you are tempted to take that perfect job at the end of the rainbow, don’t even consider it at this time. This will certainly get your home loan application thrown in the trash.

And do not change how you are being paid at work. If you are on salary, stay on salary until after you complete your home loan closing. You will be thanking me for these tips when you are moving into your new dream home.

If you want to know more about a St Louis home loan, they visit Floyd’s site on how to choose the best St Louis refinancing expert for all of your St Louis lending needs. Or give us a call at 314-336-9111.