After receiving your mortgage offer there are a few things you should do - or rather, not do.
They include;
Don’t apply for any other new credit. Doing so may well change your credit profile and result in your offer being withdrawn.
Don’t pay off debt. This might sound silly, but if you think about it, it’s not. Any change to your credit profile (such as by reducing savings) can affect your mortgage offer.
Don’t change your job! At least, make sure your lender is OK with the new position. Changing your personal profile may well invalidate your mortgage offer.
Don’t fall behind on your existing bills. It may sound obvious, but incurring a credit strike after your offer won’t help you at all!
Finally, make sure that you provide the mortgage lender with all information they request promptly and once you have an offer don’t forget that in a buyer’s market cash is king! As the holder of a mortgage offer in principle, make sure you get a good deal from your seller.
Applying for new credit
Mortgage lenders sometimes do a further credit check before they release funds to your solicitor and anything new can cause issues!
If it's just an inquiry, that usually doesn't cause a problem, but if you've opened a new account then it will have to be verified and that could delay your settlement.
Your credit score could change because of the new credit, which may mean that your interest rate must be adjusted.
Making major purchases
If you buy furniture or appliances with credit, your lender will need to factor in the payments to your debt-to-income ratio, which could result in a cancelled or delayed settlement. If you pay cash, you'll have fewer assets to use for a down payment and cash reserves, which could have a similar impact.
Paying off all your debt
"Every move you make with your money will have an impact, so you should consult with your lender before you do anything. Even if you pay off your credit card debt it can hurt you if you close out your account or reduce your cash reserves.
Changing jobs
If you can avoid it, try not to change jobs after a preapproval, even if it seems like a good move, we'll need to verify your employment and you'll need one or possibly two payslips to prove your new salary, which could delay your settlement.
Ignoring lender requests
If your lender recommends or requests something specific, you should follow directions and do it. Providing all documents as soon as they are requested can help avoid delays in the settlement process.
Falling behind on your bills
You must pay all bills on time and make sure you don't have an overdraft on any account. If you have payments automatically billed to a credit card, you should continue that practice. Your preapproval is a snapshot in time and you want to make sure your finances stay as close to that snapshot as possible.
Make sure you discuss everything with your mortgage broker and stay in constant contact throughout the loan process.
Contact Mortgage Required to speak to a mortgage adviser on 01628 507477.
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