#7 OK! Let’s Clean House!






Clean House?  Well, that can mean many things to many people!  So, what do I mean by “clean house” when all you want to do is get a loan to buy a home.  No mystery here – but no progress either, until you and your mortgage lender get all your facts, figures, and credentials pulled together, and in good condition!

Oh, boy.   How and where do we start that process?   Simple: we begin at the beginning.   Here’s where your financial history (good, bad or indifferent) comes into play.  We are going to take a nice hard look at your Credit history, your Income patterns, your Assets (liquid and non-liquid) and...your Goals!  We will then be working on the compatibility of all factors and requirements for a home loan.

It is going to also be a matter of trust, authenticity and confidentiality.  Without mutual respect for those factors, not much else can happen.   Just as you and your mortgage lender need confidence in those areas, time itself becomes a serious matter.   In the previous articles about Credit, Income and Assets you will have noticed that there were points made about time-sensitive patterns (such as cash needing to be in a bank for a specific length of time in order to be counted as valid).

Responsiveness is important – and will be critical when you and your mortgage lender are considering your financial profile, the work that must be done and the time it takes to make things happen with your data.  When your adviser needs information, they need it asap!   Circumstances in the financial market are always shifting.   Everything from a favorable home buying market to interest rate activity, to the time it takes to fix a faulty credit report come into the picture.

We can’t control those ups and downs, but you can control your own conscientious follow-thru in the preparatory process.    Timing is important from the get-go– on both sides of the fence.

In your first meeting with a credentialed mortgage lender, be prepared to take notes and make lists! There will be probably be homework!   

First, we will pull your Credit report for your mortgage lender to carefully analyze. At that time you need to “protect” your credit picture by NOT authorizing other, multiple credit inquiries.

Next, we will examine your Income.  Your mortgage lender will need access to all your income documentation in order to accurately calculate your income.  We will need W2’s, 1099’s, and, if you are self-employed, complete tax returns for the last two years.   If you are on Social Security, we will need to see your “awards letter.”

Then, we will count and verify your Assets.  You will need to furnish two months of bank statements, pension documents and retirement documents such as 401K, IRA, etc.

It’s good to understand that this process is a partnership, and the more responsive and efficient we can be for each other, the smoother the journey!  Getting all the needed documents together and in good order may feel like a huge job, but it’s the essential foundation for acquiring your home loan – and then your home!   Your mortgage lender will help in many ways.  The electronic assists now available make the transfer of information light years easier.  For instance, a lot of the back-and-forth of documents exchange can take place online!  Make lists, and ask all the questions that come to mind – let your mortgage lender sort them out for relevance.

That’s an abbreviated outline of what lies ahead when you start the mortgage loan application process.  Then, you’ll be on the way!

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