A loan is required to purchase a home. To qualify, you will need to work with a loan consultant. You’ll fill out a loan application, then wait anxiously to hear back.
Your credit score might have taken a significant beating recently. Your loan consultant may report that your credit score needs some work before you are eligible for a loan. It happens all the time.
A loan officer who is experienced and motivated can make all the difference in getting the loan or giving up and becoming frustrated. The unsung heroes of home-buying are loan consultants. Some are very creative and can work credit miracles to close deals.
We’ve seen home purchases plummet because home buyers didn’t fully understand the role and responsibilities of loan officers in the home mortgage process.
Each state regulates loan officers. There are many rules and regulations that govern what loan officers can and cannot tell clients. We are often the ones that clients commiserate with when deals go south or loans don’t close.
We are not loan officers so we can discuss their concerns without sharing names or getting into trouble. In the interest of closing your loan on any property you may purchase, here are three things a loan officer might tell you:
“I don’t get paid until you complete a home purchase with me. The closing of a home is when loan officers are paid. Most loan officers will help you qualify for a loan if you aren’t eligible today. However, they have no obligation to help you. They may choose to help you in the hopes that they can get you approved and get paid for their efforts. For closing difficult loans, loan officers do not get any extra. They are often burned by insincere or unappreciative buyers.
Contrary to a Realtor, there is no upfront contract that requires you use a specific loan officer. It’s possible for a loan officer and buyer to spend months or years getting them ready for a loan. Then they close another deal. Talk about betrayal!
Buyers who say they want to be helped by a loan officer but do not complete the required work to improve their credit score are worse. If you’re not really ready to do everything possible to get approved now, you might as well just accept to try again later. Do not drag your loan officer along a torturous path to nowhere.
“If you refuse to tell me the ugly truth, it’s impossible for me to help you.” The last few years have been difficult for us all. There have been many job losses, as well as new jobs that were found and lost. Sometimes, work hours were cut drastically. Sometimes, you were forced to accept a bill that was not yours. It’s not your only choice.
Your credit score is guaranteed to be worse than that of your loan officer. It is now what happens next. They will be able to plan, repackage, and make the most of the story if they are fully informed. It is not a good idea to downplay or hide financial details. One, the truth will eventually be revealed, and it will always be at the worst time possible for you.
Any credit problem can be repaired if you have enough time. Full disclosure upfront gives loan officers a clear understanding of the work involved and how long they can wait to receive compensation.
You can certainly repair your credit but you should talk to me first. Credit repair consulting is available for a fee by some loan officers. This is a smart way for home buyers to get the help they need. A price tag for the repair removes some of the concerns that loan officers may have about your commitment to improving credit. It’s a good idea to ask your loan officer about such a program.
Some home buyers may want to save some money and improve their credit score. It’s not necessarily a bad idea if you do it right.
It is a bad idea to jump in and do things, such as paying off old accounts or contacting creditors. Without a plan, you will fail to succeed. Credit rules are constantly changing and they don’t follow the usual logic. Sometimes, doing something that seems obvious and sensible could actually make your credit score lower.
Instead, meet with your loan officer for a strategy session. Ask them for three to four suggestions that you can implement over the next six months. Next, you can go do these things. You can return in six months to review your credit status and receive marching orders for the next six months. You’ll eventually reach credit goals step by step.