By Dina Vicari
A necessary but intensive task during your journey to purchase your new home will be providing your mortgage representative with all of the financial records and additional information they may require during the home buying process. Equally, during a re-finance of your existing home many of the same financial records will be required. In either case, the process is started with an application and then moves through the underwriting process until the loan is clear to close. This time period may span from 30 days to several months, depending on the complexity of the loan program. There are several tips to remember which will help achieve a smooth closing.
First, as an applicant, you never want to open new credit cards, switch credit card balances to new credit cards or make large purchases on existing credit cards. Even the smallest of purchases on a new card may lead to a much larger available line of credit. This is important to remember when you are paying for movers or looking to purchase new appliances and/or furniture for your new home. All of these actions can disrupt your income to debt ratio which can be a major obstacle in getting to that clear to close position. Make sure prior to utilizing any credit that it is discussed with your Attorney and mortgage representative to avoid delays in obtaining clearance to close your loan.
Second, in a situation where you are either re-financing your existing home or purchasing a home that requires repairs prior to closing, make sure all home improvements/repairs are completed prior to the home appraisal. Nearly all loans require an appraisal. Therefore, in order to avoid any delays with your closing, make sure you properly plan the timing of your appraisal. Timing of the appraisal should be discussed with your Attorney and mortgage representative to ensure that there are no on-going improvements within the property that would require a re-appraisal, which will delay the process and cost an additional fee.
Third, it is important to make sure you are prepared for closing and have enough money saved-up to bring to the closing table. At the time of closing there are lender costs and third party costs, such as payments to insurance companies, surveyors, title companies, home owner associations, tax office, municipal utilities and many more, which must be paid at closing. It is important to communicate with your Attorney and mortgage lender to review all of the closing costs that you will be responsible for at the time of closing.
The above items may be overwhelming but we at R.C. Shea and Associates can help you through the process. The law firm of R.C. Shea & Associates, Counsellors at Law, is a full service law firm representing and advising clients in the areas of Estate Planning, Estate Litigation, Personal Injury, General Litigation, Real Estate Law, Medicaid Law, Medical Malpractice, Workers’ Compensation, Land Use and Planning Law, Wills, Trusts, and Powers of Attorney and much more. Call or visit our office Toms River office at 732-505-1212, 244 Main Street, Toms River, email us at Rshea@rcshea.com or visit our website at www.rcshea.com.
