5Mistakes

Warning! Are You Making These Mistakes That Could Be Killing Your Credit?

Congratulations! You filled out your loan application...

with a lender and you are under contract on your dream home! You are handing the keys over to the mortgage company and keeping your fingers crossed that your loan will go through. Maybe, you aren’t worried in the slightest because you know that you have a stellar credit score, money in the bank, and everything seems to be going smoothly. On the other hand, that little voice inside your head is persistently egging at you, telling you the loan isn’t going to go through because of x, y, and/or z. Either way, we want to make sure you feel 100% confident when applying for a mortgage loan at any point in your life. 

As a lender, we take your documents and push the loan through the process as soon as possible. Typically, we get everything ready with time to spare and you are looking good on your clear to close. THEN you decide to open a new Target Red Card (come on, have you ever met anyone that does NOT enjoy shopping at Target?), one week before we are closing on your home… OR you deposit all of your mattress money into your bank account because you’re getting ready to buy some pinterest-worthy furniture for your new digs. You didn’t want to put it on a credit card or make a large purchase before closing, right? 

STOP RIGHT THERE! We have got to get you prepared, otherwise that home that you have invested Earnest Money into, may disappear. This is not an exaggeration. We have borrowers tank their loan in minutes.

Let’s make sure we set you up for success and get you that dream home!

Not sure where to start? Have more questions? Find a Loan Officer and ask them anything!

Here are 5 Credit Mistakes to Avoid During the Loan Process

We may pull your credit report at closing, and if your credit scores have dropped, you may no longer qualify for the rate that was underwritten and the final approval may come back with a higher rate. You may have to start the process over again depending on how badly you have damaged your credit.

1. DON’T APPLY FOR NEW CREDIT OF ANY KIND.

Warning! Are You Making These Mistakes That Could Be Killing Your Credit?

We talked about this previously, but let me stress that unless you are given specific instructions to do so, it is best to avoid any attempts at obtaining new credit. This includes “Pre-Approved” offers that you have received in the mail, or at a department store that offers a discount for applying for their store card. When your credit is pulled by a potential creditor or lender, you can lose points from your credit score immediately, so best to just hold off for now.

2. DON’T CLOSE CREDIT CARD ACCOUNTS.

Warning! Are You Making These Mistakes That Could Be Killing Your Credit? Ryan Gosling

Hold off on closing credit card accounts until after close. If you do close an account, it can impact your credit score in a number of different ways, such as decreasing your “available” credit, thus increasing your balance/limit or utilization percentage. It can also affect the length of credit history factor.

3. DON’T MAX OUT OR INCREASE THE BALANCE ON ANY OF YOUR CREDIT CARD ACCOUNTS.

Warning! Are You Making These Mistakes That Could Be Killing Your Credit? Joey Chandler Friends

We know that it’s tempting to order those new Lay-Z-boys for your man cave, but please refrain! It’s a tragic mistake. Increasing credit card balances, is one of the fastest ways to bring your scores down and can impact as much as 50-100 points immediately.

Enjoying our blog so far? Great! Check out our related posts here:

How To Improve Your Credit Score

In the wonderful world of collections, there are actually many tips and tricks that can help relieve you of these financial burdens. So many in

4. DON’T DO ANYTHING THAT WILL CAUSE A RED FLAG TO BE RAISED BY THE SCORING SYSTEM.

Warning! Are You Making These Mistakes That Could Be Killing Your Credit? The Office GIF

The small things matter here. Avoid adding new accounts, co-signing on a loan, changing your name or address with the bureaus. The less activity on your reports during the loan process, the better. Don’t give them a reason to reevaluate your application.

5. AVOID DEPOSITING CASH

in your bank accounts. Remember that mattress money? Keep it where it is because if you deposit it, the lending guidelines require us to document where it came from. I know this seems counterproductive right? In this case, it’s true; more money more problems. Trust us on this one. 

 If you have any questions feel free to give us a call. Let’s make sure we protect your credit score while we are securing your home loan! Being proactive with your credit can make financing a home a simpler and faster process. We want to help you get into a home!

Ready to see the true possibilities of owning a home? We’re happy to help. Get a payment quote and one of our Loan Officers will gladly assist you.

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Easy Ways To Declutter: How To Get Your Home Into Shape

Easy Ways To Declutter: How To Get Your Home Into Shape by Jackie Waters from Hyper-Tidy

Decluttering
your home has many benefits; aside from making it more aesthetically pleasing,
getting organized can also help improve your mood and prevent stress, anxiety, and even depression from setting
in. Many homeowners aren’t sure where to start, however, and are overwhelmed at
the thought of tackling bigger jobs in the basement or garage. There are many easy ways to clear out your home without the
help of a professional, and it pays to have the right tools and knowledge
before you begin.

First,
you’ll want to think about whether you’re going to try to sell any items you no
longer want, as these will need to be pulled out and set aside. Many homeowners
plan for a garage or yard sale, but you can also place gently-used
items up for sale with apps like Poshmark and Vinted. Have cleaning supplies
ready before you begin, and make a plan for large items of furniture (in case
you need help moving them).

Read on to find out more about the best ways to whip your home into shape by
decluttering.

Learn more about the second-hand
economy

The
second-hand economy is often talked about these days as
a way to make money, but many people aren’t sure exactly what it is or how to
get involved. In short, the second-hand economy is simply a way for anyone to
sell or buy gently-used items in order to make or save money, and it’s highly
beneficial for the environment, because it prevents buildup at landfills–one
of the biggest contributors to climate change. Think about the items you own that
you no longer need or want; would they make a good fit for selling through an
app or other marketplace?

Get organized

One
of the best things about decluttering is the ability to get organized, because it will help you maintain
a clean and tidy home even when you’re busy. Having bins and shelving to place
everything you own will allow you to keep things neat and clean up quickly
throughout the week, saving you from having to complete a big cleaning job all
at once. Introduce storage solutions to each room as you declutter; you might look
for furniture that has hidden storage, especially if you’re short on
space.

Remember the rules

There’s
a general consensus among professional organizers that if you have items in
your home that haven’t been used or worn in a year or more, they can probably go. Unless it’s
a seasonal item, think about whether you’ll be able to get any use out of it or
if it would better serve someone else. There are many places you can donate to;
look online to find out what your local options are as far as thrift stores and
shelters. Many of us hold emotional attachments to belongings, so keeping the
1-year rule in mind will be helpful when you’re cleaning out your closets.

Start in the bedroom

Many
people don’t realize how much clutter their living space contains until they
start the process of tidying up, and this includes the bedroom. You may have a
nightstand full of books to be read, or a dresser surface full of jewelry and
perfume bottles. Look around, and make a list of all the spots in your room
that could be pared down or organized a bit better, and do this first, as it
can benefit your ability to sleep well and reduce anxiety.

Decluttering
your home can be a big job if it’s never been done before, so keep in mind that
you don’t have to do it all in one day. Break down the process over several
weekends to keep from getting overwhelmed, and make plans to get help if you
need heavy furniture to be moved.