Mistakes to Avoid When Applying for a Mortgage

KEY WEST, Fla. - Dec. 20, 2016 - PRLog -- Per Fred Mullins, Top Producing Member of Team Mullins at Coldwell Banke Schmitt in Key West and owner of www.lowerkeys-homes.com,"The home loan approval process is a nerve racking experience for most applicants because they are unsure what to expect. Even those borrowers who are well prepared and are pre-approved take missteps which can delay or derail a home buying deal.

It's best to be in the know so you aren't unexpectedly surprised with bad news. Here are the most common mistakes to avoid when applying for a mortgage and getting through closing with the keys in your hands:

● Opening new credit lines. You should never apply for new lines of credit when you're applying for a mortgage. Even if you have been pre-approved for a home loan, have passed the inspections, gone through the appraisal process and are scheduled to close. Lenders often run "soft" secondary credit checks just a day or two before settlement to ensure borrowers' debt to income ratio or future DTI is acceptable.

● Running-up balances. By the same token, you should completely avoid adding to credit line balances. Higher balances will also impact your debt to income ratio negatively and it could very well cost you the final approval to be denied.

● Make one or more large withdrawals. You'll need a sizable amount of cash in your bank account to pay for down payment, inspections, closing costs, and other expenses. While your lender will expect you to pay for inspections prior to closing, the remaining monies should be there for closing costs and down payment.

● Change employers or careers. Lenders are risk averse, plain and simple. This is why they require so much documentation to approve a home loan. They also don't relish uncertainty and this is why your work history plays a big role in your mortgage approval. If you change employers or worse, change careers, it could well cause your financing to fall through.

The bottom line is, getting a home loan is difficult enough without any extenuating circumstances. If you aren't careful, you could inadvertently cause you financing to be delayed or outright denied. Be sure to communicate regularly with your bank or mortgage broker so you aren't caught off guard with disappointing news about your financing.

Fred Mullins, P.A. holds an MBA, B.S., real estate license United States Coast Guard Master Captain's license and commercial pilot's license. With over 20years of cross functional experience in real estate, international asset management and construction management, Fred's experience places him as one of the top real estate professionals in the Florida Keys.For help with buying or selling Real Estate in the Lower Florida Keys,see http://www.lowerkeys-homes.com