Not to Do(s) When Financing / Refinancing

If you are looking to finance or refinance your home, here are a few things NOT TO DO:

Don’t Kick The Tires. How much you put down, credit affects your interest rate. It drives lenders crazy to pick up the phone and be asked what their best rate is. How much you put down on your home and how good your credit is directly affecting the interest rate on your loan. You can shop for rates, but be prepared to spend time on the phone or in person providing your lender with enough information to give you an intelligent answer.

Don’t Lie On Your Application. Some borrowers lie. They inflate their income, deny credit problems, and minimize debts like car and school loans. Be sure you tell your lender about any credit problems you have. The lender has to verify your income, debts and credit score, so everything will come out in the end. If you lie, you just end up looking bad, and you could go to jail for fraud.

Don’t Expect Your Lender To Drop Everything And Work On Your Loan. Good lenders are busy working on hundreds of other loan applications. Don’t assume yours will immediately rise to the top of the pile. If you have a short window of time, ask the lender if he or she can get your loan done faster. If the answer is no, find someone else.

Don’t “Play The Float”. Most borrowers don’t understand how a rate lock works. A fixed rate is a commitment by the lender to lock in a specific interest rate for a specific period of time. If you wait to lock in, hoping rates will go down, and they go up, you are out of luck.

Don’t Listen Selectively. Lenders complain that they explain things to borrowers who choose not to hear them. While it’s true that some of these concept are a little difficult, you should tune in and listen to everything the lenders tells you. Write it down if you have to. If the lender tells you they need certain documents, provide them. If you don’t, you could find that your application drops to the bottom of the stack.

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