Just Don’t! Seriously, Avoid These 10 Common Mistakes
Not getting pre-approved for your VA Mortgage
Shopping for a house before getting pre-approved is like buying your shooting badge before you qualify on the range. Don’t do it, you’ll just feel like a boot wearing an expert badge when you actually qualify for a pizza box. That’ll be a fun conversation when someone points it out.
You know better than to rush outside the front gate to finance a vehicle (or you should). You will likely encounter overpriced vehicles with overpriced financing and fees being sold to you from people who barely know what type of car they’re selling you. Shop with independent experts with VA mortgages who ONLY work for you.
NO Credit score preventative maintenance schedule
Credit Karma will just make you sad by inflating your hope with an overly positive consumer score. Instead get your annual free credit report backed by the FTC). Or better yet, sign up for your free Vetted VA Go Bag powered by Finlocker.
Changing your ‘Pre-approval BZO’ (Battle-site Zero)
Applying for new credit, or opening new credit cards, financing new furniture? Just don’t. A credit report is a snapshot in time of your credit worthiness. The new account has no history and immediately decreases your score by reducing the average age of all your credit accounts.
Making late mortgage payments or worse, foreclosure or Bankruptcy. Look, this happens. That’s okay. Just know that the VA guidelines require certain time and distance between when this happened and when an underwriter will approve an application for a Loan.
If you think this could occur, triage is a proactive planning and addressing of potentially life-threatening injuries. Financial triage is a thing, don’t go through injuries alone.
Not saving enough for out of pocket expenses. Not saving reserve mortgage payments. Or, expending large amounts of your capital as a down payment. There will be expenses like inspections or appraisals. Much can be paid for by the seller if the market is right.
But you don’t want to be without some cash to protect your interest in the purchase, and you don’t want to ‘inflate’ your interest rate with ‘lender credits’ or ‘lenders covering costs’.
USA PATRIOT Act problems // Big Brother
Not seasoning your assets beforehand in a bank account. Big deposit because someone loves you? Great, now wait a couple months before applying. Cash is red flag (funny we know).
Source your income and keep it regular or be able to explain and source anything unusual.
Kind of like the reference above, this is a basic BZO element and will impact your shots accuracy if not planned for.
Changing jobs in a similar field? Not a problem. Becoming a teacher after leaving a job as a mechanic? Maybe doesn’t make so much sense unless you’re teaching shop or can explain the likeness of the positions with a Letter of Explanation. Keep logic in mind.
Bad fundamentals // Holding your breath while shooting
Not locking, waiting for a better rate, or waiting for rates to ‘go down’ on average cost consumers more than it benefits them. Kind of like gambling, only with the biggest cost to manage the largest financial asset you own.
Look, no Vetted VA Lender in here will allow this to happen. Vetted VA Originators are like shooting coaches spotting and telling you when to pull the trigger and any adjustments needed to impact the desired target. Even sniper teams are in 2’s: 1 shooter and 1 spotter.
Attempting to refinance after listing your home. Okay really? That doesn’t show good common sense. Why would you try to refinance when you wanted to sell? There could be some good reason, but decision making may not be your strong suit.
We get it, you want to pay less while you decide to sell, but this creates a major problem as the new loan created is a hostage waiting to be paid off early. This action falsifies occupancy intent and increases costs for all Veterans.