Even though you may have a mortgage approval and all of your financing conditions have been met, you aren’t guaranteed the loan until it has actually funded on your closing date. There are several things to consider that will ensure that your mortgage closes smoothly and on time.
The first thing to consider is avoiding taking on additional credit. While it may be tempting to go to The Brick and load up on furniture and appliances, make sure that you do not apply for a loan in order to buy them. Even an interest free no payment loan can affect whether or not you qualify for your mortgage. Wait until you have the keys to your new house before borrowing money for furniture.
In addition to avoiding borrowing to buy goods for your new home, it is also important to avoid borrowing money to buy new vehicles or toys. It is amazing how many people purchase houses and cars at the same time – however doing so without checking with your mortgage professional first can create a catastrophe when it comes time to close on your new home.
While being conscious of your borrowing leading up to your home purchase is important, it is also important to pay attention to any investments that you will be using for your down payment. If the stock market drops like it has in the last couple of weeks, you could find yourself short when it comes time to cash in your investments to buy your home. Unfortunately, if you lose part of your down payment, borrowing it from somewhere else may not be an option and you may not be able to close.
Closing your mortgage will also require that you maintain your employment. If you quit your job before you take possession of your property the lender has the right not to fund your mortgage. Even if you get a new job, the lender still may not fund your mortgage, even if you have increased your salary. Furthermore, if your new job has a probationary period, the lender will be even less likely to fund your mortgage.
Aside from your mortgage not funding, you also want to make sure that your mortgage closes on time. In some cases, if your closing date changes you may lose your rate hold, forcing you to pay more for your mortgage.
The process of getting and closing a mortgage is an exercise in communication between you, your REALTOR, and your mortgage professional. Proper communication is key, so make sure that everyone is aware of any potential issues or changes to your financial situation right away. If you are unsure if something will affect your mortgage, ask.
