Lender Advice for Future Home Buyers

Lender Advice for Future Home Buyers

When most people start thinking about buying a home, they usually start with casual online  searching, not early conversations with potential lenders. It can be months or even years before a home “looker” becomes a home buyer, depending on their reason for buying — waiting for the last bird to leave the nest, doing some needed credit repair, saving for a down payment, or relocating for a new job. I asked some of Puget Sound’s top mortgage lenders what they thought that a person should do now if they are planning to purchase a home within the next six months.

Lenders Advice for Home Buyers

Advice from 3 Top Puget Sound Area Lenders:

Laurie Ausmus, Peoples Bank of Washington, says “Get your taxes done now as it is taking much longer to get the federal tax return tax transcripts (IRS 4506T) that are required during the loan underwriting process. Many times an extended tax return is not acceptable once you pass that magic date. If you close your loan before April 15, then you do not need to have the prior year’s tax return done — unless you had a big increase in income that you want to use to qualify for a higher loan.”

Gregory Phillips, First Tech Federal Credit Union, has this sage advice. “Talk to a lender right away. Even if you don’t think you are ready to buy a house quite yet, an experienced mortgage lender will be able to prepare you for what to expect. They may also be able to give you some strategies for being better prepared when the time comes. Even if you have already met your down payment goal, there are other steps you may be able to take so that you will qualify for a better rate or loan program when you buy a home.”

Conrad Wouters, Evergreen Home Loans, has some good advice about your down payment and later purchases. “Having the down payment assembled into one place as soon as possible is very important. Often buyers intend to use funds from gifts, stocks, overseas investments, and various unrelated accounts. We need to document all the sources and the movement of funds between those accounts. Buyers funds should be combined and “seasoned” in one account for at least 2 full months before applying for a loan. And don’t go out and buy furniture or a new car after the loan is approved but before it is closed.  We run a new credit report just before closing and any new debt needs to be documented and underwriting approval is needed again – which can delay closing or even cause the loan to be denied at the last minute.”

You will also want to start gathering the information that you need to build your loan file. Check out my blog on that topic, 6 Easy Steps to Building a Loan File.

photo credit: House via photopin (license)

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