Common Problems to Avoid when Applying for a Home Loan

When you purchase or refinance a home, the average escrow period runs around 30 to 45 days.  During this period the lender is going through your loan application and verifying the information that was listed and provided to them.  There are a few things that you should be aware of during this process:

• Be sure to make all of your credit payments on time and let your lender know if you are going to open any new credit accounts prior to closing.  It is possible that a new credit report may be pulled just before closing.  You want to keep this in mind also pertaining to purchasing new appliances or new furniture prior to closing escrow.
• Let your lender know if you have any job changes.  A call is made to your employer the day of funding to verify you are still actively employed there.
• Funds to close must come directly from the accounts verified.  If you transfer funds between accounts or make other additional deposits, you will need to document the transfers or deposits.  For example, if you have $20k with ABC Bank and $30k with a credit union and you need $40k to close, if you transfer funds from ABC Bank to the credit union and then into escrow, you will need to paper trail those transfers.  Or you can just wire money directly and separately from ABC Bank and the credit union.
• You may be asked to provide updated bank print outs during the process, for example to show your earnest money deposit clearing your account if you are purchasing a home.  All large deposits which do not come from payroll do have to be documented/sourced.  Please be aware of this and save any paperwork for large deposits you may make through the process until things are closed.  This is a requirement of the U.S. Patriot Act.
• On the appraisal, there may be cases where sale comparables may be a bit older, or further away than typical or do not adequately support the appraised value.  The loan underwriters may call for an appraisal review, which could incur additional fees.  This should be noted on your good faith estimate.  This more commonly comes up on properties that have been ‘flipped’ or are in more ‘rural’ areas.
• Be aware that it is common to receive additional disclosures throughout the loan process.  Preferably, these disclosures will be sent to you by secured and encrypted email when an email address is provided.  Find out from your lender if these need to be signed and/or returned in any specific timeframe.

You want to have good communication with your lender about any type of financial changes that you may make during the loan process to help prevent any last minute delays.

If you would like straight forward, comprehensive feedback on the home financing options available, please call Julie Ozanich at 858-369-7510. NMLS#: 479603.

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With a mission to provide a higher standard of mortgage lending services, Julie began her career in mortgage banking in 1990.  To date, Julie has successfully closed over $1 billion in mortgage loans and helped over two thousand customers achieve their mortgage goals.  Program availability may differ slightly in different states.  Terms may vary.  Subject to change without notice. Bank of Manhattan is not affiliated with nor endorses The Carmel Valley Life. NMLS# 401422.