7 Things You Should NOT Do Before Applying For A Home Loan.

1. DON’T buy or lease an auto. The lender looks carefully at the debt-to-income ratio and a large payment, such as a car lease or purchase, may greatly impact those ratios and prevent you from qualifying.
2. DON’T move assets from one bank to another. These show up as new accounts and complicate the application process. If you do move accounts, you must disclose and document the source of funds for each new account and/or deposit. Consolidate your accounts after closing.
3. DON’T change jobs or give notice at your current employer. A new job may involve a probation period, which must be satisfied before the income from that job may be considered for qualifying purposes.
4. DON’T buy new furniture or major appliances for “new house.” If the new purchase increases your debt load, it can disqualify you from the loan or deplete your funds for closing. Some lenders pull a new credit report just prior to closing.
5. DON’T attempt to consolidate bills before speaking with your lender. The lender will advise you if this needs to be done.
6. DON’T pack or ship information that may be needed for the loan application. Important paperwork such as: two years tax returns and W-2s, two months of most recent bank and brokerage statements, divorce decree, closing statement (HUD-1) if you’ve just sold a home.
7. DON'T have any personal property written in the purchase contract for the new home.

*Courtesy of Michelle Piccari, Mortgage Planner American Equity Mortgage 

The Loan Process

In a recent Zillow survey, 44% of home buyers admitted they are "not confident in their knowledge of mortgage or the mortgage process." Home buyers may depend on you for information and help in getting them through the loan process successfully. Let's take a look at the phases of the Mortgage Circle of Life - Origination through Closing.

Origination
The mortgage professional: Determines how much a customer can afford to spend on a home; completes the mortgage application with the customer; orders of credit report and reviews credit history; discusses available loan programs; explains documentation that's required; and verifies a customer's approval/qualification for the mortgage requested.

Processing
Once the customer has a contract on a property, the processor orders an appraisal; initiates / completes a title search and flood certification (if needed); collects, verifies, and reviews documentation; obtains appraisals; bundles the documentation and sends it to Underwriting.

Underwriting
The underwriter analyzes loan documentation for accuracy; evaluates the customer's ability and willingness to repay the loan based on credit and employment history; reviews the appraisal to determine that the property complies with loan program guidelines; ensures there is clear title to the property; determines risk acceptability; and approves or denies the loan.

Closing
After the loan is approved, the closing agent conducts the settlement meeting; makes sure all documents are signed and recorded and closing fees and escrow payments are paid and properly distributed.

Once the property has changed hands and the customer has the keys to the house, they can move into their new home.

*The above information has been obtained and revised from the Zillow website.