Individuals are often misled that once the offer on their dream home has been accepted, the rest is history, and that’s not the case. Even after your mortgage lender has approved your application, they still have every right to cancel the deal. That’s why we at Dominion Lending Centres Nasakasa encourage people to avoid any significant life changes before closing.
The first and most important thing is your employment. Say you have been working for a specific company for an extended amount of time, and during your mortgage process, you get a better offer. Of course, the first thing that comes to mind is to quit the current job and start a new one. That can potentially cause a few issues with the lender, as now you will have to confirm your new income. This situation can get more complicated as you just started working there, and nothing is guaranteed; the lender will require confirmation that you are not in a probationary period.
You have to send a down payment verification at the beginning of the application process. Once the deal is near the last stretch, the bank may ask for final confirmation of the down payment. Sometimes during this process, once borrowers factor in all the closing-related costs, they realize they are a little short and end up asking a family member for a gift. That can cause issues. Although this is an acceptable source of down payment, the borrowers will now have to provide a gift letter and any other required documentation to show where the funds originated. That could cause delays in closing and add extra expenses.
A considerable roadblock faced more often than imagined is adding additional debt to your plate right before closing. The lender will always request a credit bureau report before the closing to see your debt ratios and assess if you can afford the mortgage. If right before closing, you buy a new car, the ratios may skyrocket. In this case, the lender has every right to cancel the deal. Holding off on buying that new car or those new appliances for your new home until after the transaction is closed can avoid many issues.
Another critical factor during your mortgage process is to keep your credit stable. Suppose you have good credit and start having late or missed payments on your bills; the lender will see that during their final credit check. The lender may decide that since you can’t make the minimum payment on your credit card, you won’t manage to pay your monthly mortgage payment. That goes if you have a high ratio mortgage because the insurers have credit score standards that could disqualify you for a mortgage.
Lastly, we recommend that you use your full legal name when you are applying for your mortgage. When you are in the final stages of closing your mortgage, the lawyer must verify your identity with formal documents, matching the mortgage documents provided to the lawyer. Even if you typically go by your middle name, please be consistent with your full legal name throughout your application.
Our Dominion Lending Centres NasaKasa team comprises seasoned mortgage professionals who have seen and overcome various roadblocks. To avoid any hiccups in your approval, give our office a call at 905-997-7001 to get you approved with ease.