Don't Do These Things Before Closing Day
February 24, 2024
Some people wrongly assume that they’re “safe” once approved for an FHA home loan and start the process toward closing day.
They feel that once the loan has been approved, the transaction is “bulletproof” until closing day. But that’s not true. The seller may change their mind and back out of the transaction. The house might appraise for a lower amount than the seller asks, and the borrower decides not to pursue the property after all.
Those are just two of the things that can stop a home loan. But there are others. A home damaged or destroyed before the closing day is an extreme example, but it happens just often enough that there are provisions in FHA loan regulations for just such a situation.
Don’t Change Jobs Before Closing Day
Any major change in your income that makes the lender question whether it’s stable and reliable must be avoided at all costs on the road to closing day.
The lender may be required to re-qualify you for the loan if your financial picture changes including switching to a lower-paying job, moving from salary to contract, or other big alterations.
Don’t Skip Any Payments Before Closing Day
Late and missed payments (especially for housing) will show up on your credit report, and if the lender sees those issues before closing day, it may force a reconsideration of your loan.
Don’t Apply for New Credit Before Closing Day
The Same guidelines that inform the lender about your employment (stability, reliability) also inform the lender’s need to verify your credit a second time or even a third time before the closing day if conditions warrant.
If the lender pulls your credit a second time and sees you have new potential debts, that could force the lender to requalify you for the loan.
Don’t Deviate from Lender Cash to Close Instructions
Shortly before closing day, some borrowers are contacted by someone pretending to be from the lender, asking you to pay your cash to close the deal differently than you and the lender worked out ahead of time. DO NOT DO THIS.
No matter what you are told by a third party contracting you, only change the payment arrangements once you personally speak to your loan officer on the telephone about the request to change.
Don’t Count on Closing Day as Your Move-In Day
Scheduling the moving trucks the same day you close the deal is typically a bad move. Many variables could force a reschedule of that day, and personal circumstances, job issues, natural disasters, or other variables sometimes delay borrowers.
------------------------------
RELATED VIDEOS:
Don't Skip the Home Inspection
Bigger is Better With a Jumbo Loan
Insuring Mortgages With the FHA Funding Fee
They feel that once the loan has been approved, the transaction is “bulletproof” until closing day. But that’s not true. The seller may change their mind and back out of the transaction. The house might appraise for a lower amount than the seller asks, and the borrower decides not to pursue the property after all.
Those are just two of the things that can stop a home loan. But there are others. A home damaged or destroyed before the closing day is an extreme example, but it happens just often enough that there are provisions in FHA loan regulations for just such a situation.
Don’t Change Jobs Before Closing Day
Any major change in your income that makes the lender question whether it’s stable and reliable must be avoided at all costs on the road to closing day.
The lender may be required to re-qualify you for the loan if your financial picture changes including switching to a lower-paying job, moving from salary to contract, or other big alterations.
Don’t Skip Any Payments Before Closing Day
Late and missed payments (especially for housing) will show up on your credit report, and if the lender sees those issues before closing day, it may force a reconsideration of your loan.
Don’t Apply for New Credit Before Closing Day
The Same guidelines that inform the lender about your employment (stability, reliability) also inform the lender’s need to verify your credit a second time or even a third time before the closing day if conditions warrant.
If the lender pulls your credit a second time and sees you have new potential debts, that could force the lender to requalify you for the loan.
Don’t Deviate from Lender Cash to Close Instructions
Shortly before closing day, some borrowers are contacted by someone pretending to be from the lender, asking you to pay your cash to close the deal differently than you and the lender worked out ahead of time. DO NOT DO THIS.
No matter what you are told by a third party contracting you, only change the payment arrangements once you personally speak to your loan officer on the telephone about the request to change.
Don’t Count on Closing Day as Your Move-In Day
Scheduling the moving trucks the same day you close the deal is typically a bad move. Many variables could force a reschedule of that day, and personal circumstances, job issues, natural disasters, or other variables sometimes delay borrowers.
------------------------------
RELATED VIDEOS:
Don't Skip the Home Inspection
Bigger is Better With a Jumbo Loan
Insuring Mortgages With the FHA Funding Fee
Do you know what's on your credit report?
Learn what your score means.
