Swimming Lessons at your Bank?

Don't tread water when it comes to your credit.

It's sink or swim in light of the current market and tightening
of credit underwriting standards by both lenders and mortgage
default insurers as of late.
Keep in mind that now –
more than ever –
it’s important to be careful what you do between the time
your mortgage is approved and when it funds.

A few mortgage lenders and insurers have been doing
something lately that they have not done in a long time,
and that is pull a new credit bureau in lieu of relying on
your previous history with them prior to funding,
especially if there is a long period between the time
of your approval and when the mortgage actually
funds.
It's important to know when and how to pay off debt,
and when to keep money.

Following are ten tips to keep in mind between your
mortgage approval and funding dates:

1.Don’t buy a new car or trade-up to a more expensive
lease.

2.Don’t quit your job or change jobs. Even if it’s a
better-paying job, you still are likely to be on a probationary
period. If in doubt, give me a call and I can let you know if
this may jeopardize your approval.

3.Don’t change industries, decide to become self-employed or
accept a contract position even if it is within the same industry.
Delay the start of your new job, self-employment or contract
status until after the funding date of your mortgage.

4.Don’t transfer large sums of money around between
bank accounts. Lenders get especially skittish about this
one because it looks like you’re borrowing money.
Be ready to document cash transactions or money movements.

5.Don’t forget to pay your bills, even ones that you are
disputing and you have informed the credit bureau of the dispute.
This can be a real deal-breaker. If the lender pulls your credit
bureau prior to closing and sees a collection or a delinquent account,
the best you can hope for is that they make you pay off the
account before they will fund. You don’t want to have to scramble
to pay off a debt at the last minute!

6.Don’t open new credit cards. Again, just wait until after your
funding date.

7.Don’t accept a cash gift without properly documenting with me
– even if this is from proceeds of a wedding. If you have a bunch of
cash to deposit before your funding date, give me a call before you
deposit it.

8.Don’t buy furniture on the “Do not pay for XX years plan”
until after funding. Even though you don’t have to pay now,
it will still be reported on your credit bureau, and will become an issue
– especially if your approval was tight to begin with.

9.Get credit card balances below 90% of their limit. A maxed
out card, even if you are making payments on time,
is a red flag for lenders.

10.Be prepared to prove where your down-payment came from,
even if it was a gift from a friend or family member. Lenders
want to know you didn't borrow the money from a credit card.

While you may not risk losing your mortgage approval because you have broken one of these rules, it’s always best to talk to me before doing any of the above just to make sure!

Why Use a Mortgage Broker?

There are generally two ways to get a mortgage in Canada: From a bank, or from a licensed mortgage professional.
While a bank only offers the products from their particular institution, licensed mortgage professionals send millions of dollars in mortgage business each year to Canada’s largest banks, credit unions, and trust companies … offering their clients more choice, and access to hundreds of mortgage products!
As a result, clients benefit from the trust, confidence, and security of knowing they are getting the best mortgage for their needs.
Mortgage professionals work for you, and not the banks; therefore, they work in your best interest and give you the mortgage edge.
From the first consultation to the signing of your mortgage, their services are free. A fee is charged only for the most challenging credit solutions, and it’s especially under those circumstances that a mortgage professional can do for you what your bank cannot.
Whether you’re purchasing a home for the first time, taking out equity from your home for investment or pleasure, or your current mortgage is simply up for renewal, it’s important that you are making an educated buying decision with professional unbiased advice.
Some brokerages actually perform other services such as financial advising, or leasing, and can structure your purchase or refinance to personally fit your needs.

Loyalty to your bank can cost you thousands. Get a second opinion from a mortgage professional, and find a mortgage that suits you, not your bank and be mortgage-free faster.

Click here to find out more, book a mortgage consultation, or subscribe to my newsletter.