Being open and honest with your lender about your financial condition is crucial when asking for a loan. However, there are some information you ought to hold back from your lender because they can have a negative effect on your loan application.
One thing you shouldn’t disclose to your lender is that you intend to leave your current position or begin a new one shortly. The ability to repay the loan may be questioned if you plan to change employment because lenders normally require borrowers to have a regular source of income. It is preferable to postpone changing employment until after your loan has closed if you do have such plans.
The fact that you want to utilize the property as a vacation home or investment property is another item you should avoid disclosing to your lender. For primary residences, second houses, and investment properties, lenders often have varying requirements and interest rates. The conditions of your loan may change if you tell your lender that you intend to use the property for a purpose other than as your primary residence.
Additionally, you should refrain from alerting your lender that you intend to make sizable purchases or open new credit lines prior to the loan’s closing. Lenders consider your debt-to-income ratio, which is the difference between your total debt and total income. Your debt-to-income ratio can go up if you make big expenditures or open new credit lines, which would make it harder for you to get a loan.
Last but not least, you shouldn’t let your lender know if you’re expecting a gift or loan from a friend or relative to cover your down payment or closing costs. Receiving a gift or loan is not inherently a negative thing, but lenders frequently insist that borrowers pay for these expenses out of their own pockets. It is best to talk with your lender in advance if you want to accept a gift or loan. Should I Talk to Different Mortgage Brokers?
First, it can take time to talk to several mortgage agents. You will need to complete an application and supply documents for each broker, which can be time-consuming.
In addition, talking to several mortgage brokers may result in a number of credit queries, which might lower your credit score. Your credit score may drop a few points each time a lender requests a copy of your credit report.
And last, talking to several mortgage brokers may not always lead to a better bargain. While various brokers might provide various rates and conditions, they might also charge various fees and closing costs. Comparing the whole cost of the loan is crucial, not simply the interest rate.
In conclusion, even though it could be tempting to chat with several mortgage brokers, it’s crucial to balance the time and effort involved with any prospective rewards. It’s crucial to be open and honest with your lender about your financial condition while avoiding saying anything that would make your loan application less likely to be approved.