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When you fill out a credit application we run a credit report for the underwriter. Each lender and each loan program have different guidelines they must follow. You should not anything that will have an adverse impact during the loan process. Adhering to the following guidelines during the loan process will give you the best opportunity for success.

Don’ts…

• Don’t apply for credit of any kind. If you receive invitations to apply for credit cards don’t respond. They will pull your credit report and your score will decrease. Don’t make any major purchases such as furniture, appliances, computer, cars, etc., until after the closing.
• Don’t pay off collections or charge offs unless the lender specifically asks you to in order to secure the loan. Generally, paying off old collections causes your score to drop. The lender is only looking at the last 2 years of activity.
• Don’t close credit card accounts. If you have to do that wait until after closing the loan.
• Don’t max out or over charge existing credit cards as this could have a negative impact in your ratio of debt to available credit thereby lowering your scores.
• Don’t consolidate debt to one or two cards. Again, this will impact your ratio of debt to available credit adversely which will lower your scores.
• Don’t co-sign on another person’s loan or change your name and address. The less activity that occurs while your loan is in process the better it is for you.

Do’s…

• Do consider joining a credit watch program. Your bank, credit union or credit card company may offer a free credit watch program that alerts you to changes in your credit report. This will alert you hopefully before the underwriter.
• Do pay all your accounts on time. One 30 day late payment can cost you 30-75 points.
• Do continue to use your credit as you normally would. If it looks like you are diverting from your normal spending patterns it could cause your score to go down. For example if you have had a monthly service for internet access for the past few years there is really no reason to drop it now. Again, wait until after closing to make any changes.
• Do call us if you receive any notification from a collection agency or creditor that could potentially have an adverse affect on your credit score, so that we can direct you to the right resources and prevent and prevent any negative changes in your credit report.