Lately, I have seen quite a few loans “struggle” to get approved for one reason or another. I have been reminded that many people just aren’t aware of how some of their seemingly unrelated decisions can impact whether or not they get approved for a loan.
And there nothing worse than thinking that you will be approved for a loan only to find out that a lender won’t approve you for __________ reason.
Here are just a few things that I have seen happen recently that helped people get denied for a loan. Some of these, the loan officer was able to “fix” and get the person approved – and some of them just won’t get approved now.
With turn times on loans probably averaging about 30 days right now (as quick as 10 and as long as probably 60 days) there is plenty of time to “make or break” your loan approval right now.
Rule #1: Don’t Quit Your Job
Seems like common sense, but many people think that switching jobs — especially if it is for more money — won’t impact their approval.
Wrong.
If you think you *have* to quit your job, make sure you talk to your loan officer how it will impact your approval.
Rule #2: If It Doesn’t Fit In A Shopping Cart, Don’t Buy It
Don’t buy anything new that is bigger than you can fit in a shopping cart — and no, not the super-size flatbed shopping carts at Costco or Home Depot.
No big screen TVs. No new cars. No boats. No motorcycles.
The “shopping cart” rule of thumb is because the “bigger” the item it is, the more common it is to see people finance the “thing” and financing will impact your credit score and debt to income ratios – usually not for the better.
And no, big screens don’t fit in shopping carts for those of you who were wondering.
Rule #3: Don’t Hide It
Make sure you disclose child support or alimony. If you pay these, make sure your loan officer knows and it is disclosed in your application. I saw it missed recently and the deal is “iffy” now at best.
I know, I know – you are probably thinking that I have been hanging out with Captain Obvious too much by taking the time to write these things down – but you might be surprised to see how many times I have had the conversation with someone about how big screen TV’s don’t fit in shopping carts.
Phoenix Mortgage Rates July 3 2009
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