As soon as I realized that my personal financial picture was a little bleak, I started thinking about taking out a personal loan. I wasn't really looking forward to going into debt, but I knew that if I wanted to solve a few short-term problems, a loan would be the way to go. I talked with a few of my local financial institutions to get a good idea of what they could offer me, and then I sat down to go over the paperwork. It was incredible to see how much money I could save by securing a lower interest rate. Check out my blog for more information about loans.
One of the first steps of buying a house is getting preapproved for a loan through a lender that offers mortgages. When you get preapproved, it basically means that you meet the guidelines to get a loan, but it does not mean that the lender will definitely issue you the loan when the time comes. The lender you use will verify all your information at the time of preapproval and before you close on the loan, and if you have changes in your credit, finances, or job, you could lose the ability to get the loan. Here are several things to know to help you protect these things during this time.
Why changes can affect your eligibility
When you initially applied for preapproval for a loan, the lender based the decision on the current state of your finances, job, and credit. Over time, though, changes can occur with each of these things, and if the changes are negative, they could cause you to lose your eligibility to qualify for a loan. For example, if your credit drops from 780 to 680 during this time, the lender may no longer be able to offer you a loan, due to this big change. Because of this, it is absolutely vital to protect your finances, credit, and job during this time.
Types of changes to avoid
There are several changes you should aim to avoid during this time, and here are the main ones:
If you experience any of these changes during this time, there is a chance you might no longer qualify for a loan, even though you were preapproved for a loan at one point.
Types of changes that are fine
There are certain changes you can experience in these three areas that are not considered negative and will not harm your chances of getting a loan. One change is a pay increase at your current job. A pay increase will actually improve your chances of qualifying for a loan. A second change that is fine is a decrease in debts. If you pay off a debt you have, this will be a positive thing for your credit.
If you have not yet visited a lender to get preapproved, this might be something you should do now if you want to buy a house. To learn more about the home mortgage application process, talk to a lender today.
Share12 December 2019
