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Smooth road to the closing table

June 8, 2010

There is a new initiative that requires lenders to perform additional verification of the borrower’s social security numbers and requires lenders to pull a 2nd credit report just prior to closing.  If there is new activity on the second report then new debts and new score will be taken into consideration.   For those trying to close in time to meet the Federal Housing Tax Credit listen up!

Here are few quick tips to keep you from sabotaging your mortgage:

  • Don’t acquire new debt or new credit cards!  Wait until after the settlement to apply for new credit cards and to purchase those new furnishings for your home.
  • Review your credit report. Go over your credit report with your loan officer, make sure to report any incorrect or MISSING information. What is missing on your report today could show up later and derail your closing.
  • Keep your financial papers close at hand.  Keep all tax returns, w-2’s, paystubs, 1099’s, K-1’s bank statements, etc. in an accessible place.  You never know when you might need them, so be prepared.
  • Leave a paper trail for gift funds or large deposits.   Your lender will need documentation of any gift funds or large deposits that are not consistent with your normal pattern.  Large deposits will need to be sourced so be prepared to show where the money came  from.  If it was a bonus, keep a copy of the check.
  • Communicate a job change.  This one seems obvious but true, if your employment changes in any way, let your lender know.
  • Don’t play musical chairs with your money.  Moving funds around can create a paper trail nightmare for lenders, so keep everything where it is until your lender gives you the “ok”. 
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