Do’s and Don’ts for a Purchase Loan

  • Don’t wait until you have 20% down to buy a home. See Mike’s blog post on this.
  • Do pay your bills on time and raise your credit score over 740 and preferably over 780 (if you put less than 20% down) before you buy a home. Having a strong credit score will lower your loan fees, interest rate, and potential private mortgage insurance (PMI)
  • Don’t make any large purchases like a car, recreational vehicle, or timeshare (if you can help it) after we issue you a preapproval letter.
  • Do check in with us if anything has changed with your job, income, assets, or liabilities after we issue you a preapproval letter.
  • Don’t plan a vacation toward the end of your escrow period if you can help it, we’ll need you to sign in person with a notary before we can close and you may need to wire funds to close.
  • Do put a priority on sending us documents as soon as possible. Delays can cause rate lock extension fees and unnecessary stress on all parties in the transaction. Buying a home is stressful enough!
  • Don’t add an earthquake policy before closing if your debt to income ratios are high. (you can add this after closing)
  • Do shop for a homeowner’s insurance policy once you are in contract to buy a home.
  • Don’t purposely hide information regarding assets, income or liabilities. We would rather know what we are dealing with upfront than have it pop up at the end of the process.
  • Do tell us if you plan on receiving gift funds for your down payment.
  • Don’t move money around without telling your loan officer first. This may cause the underwriter to require more documentation which would have otherwise not been required.
  • Do tell us amounts and accounts/sources you plan on using for your earnest money deposits and funds needed to close.
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