Thursday, September 8, 2011

Buyer beware! lenders need to know everything!

Buyers beware...  When applying for a loan: lenders need to know everything!

1- All funds used for the down payment and closing costs are going to be very carefully scrutinized by the lender:
  • you must provide detailed and accurate information to show which accounts the funds are in and where the funds are coming from,
  • you must document the source of any funds that have been in your accounts for less than 2 months,
  • any changes that occur to your financial condition will need to be explained to the lender,
  • changes to your assets, employment, income or credit scores during the escrow could jeopardize your ability to qualify,
  • provide complete documents, - all pages!
  • provide documents with names, addresses and account numbers.

2- The lender is going to require a letter of explanation and/or support documentation for:
  • recent inquiries or derogatory items on your credit report,
  • recent deposits, transfers of money etc... in your accounts,
  • evidence earnest money deposit has cleared your account.  ... hum, they don't trust much...

3- If you are receiving Gift Funds the lender will require:
  • a gift letter signed by you and the gift donor,
  • evidence of the donors ability to gift the funds (bank statement),
  • evidence of the receipt of the gift funds, in your account.

4- Things not to do during an escrow:
  • do not transfer funds between accounts, nor make large deposits into your bank accounts,
  • do not buy a car!... or spend large amounts of money on stuff..
  • do not change jobs,
  • do not close or open credit card accounts.

Yes, it is a real experience, to get a loan nowadays!  ;-)

For lenders referrals, do not hesitate to contact me.

useful links

No comments: