10 Things Not to Say to Your LOAN OFFICER

At Locke Your Loan, we want your homebuying experience to be as smooth and stress-free as possible. But there are certain things you should avoid saying to your mortgage lender to ensure you don’t inadvertently hurt your chances of getting approved. Honesty and clarity are crucial when it comes to your financial journey, and understanding what not to say is just as important as knowing what to say. Here’s our list of 10 things not to say to your loan officer and why.

1. Anything Untruthful

Be honest! Misleading or omitting information on a loan application could lead to mortgage fraud and denial. Lenders verify financial details thoroughly. If you’re unsure about what needs to be disclosed, just ask—we’re here to guide you.

2. I don’t care if it’s expensive. What’s my max?

Asking for your maximum borrowing capacity without considering affordability raises red flags. Stick to the 28/36 Rule, which recommends spending no more than 28% of your gross monthly income on housing and 36% on total debt. It shows you’re financially prepared for homeownership.

3. I forgot to pay that bill again.

Consistency is key when managing your finances. Late payments show up on your credit report, signaling risk to lenders. Avoid the cringe-worthy conversation by staying on top of your bills.

4. Check out my new credit cards.

Hold off on opening new lines of credit or making big purchases during the loan process. Additional debt can impact your debt-to-income ratio and jeopardize your approval.

5. Which credit card isn’t maxed out?

Maxed-out credit cards indicate financial strain. Keep your credit utilization low, especially before closing, as lenders often run a final credit check.

6. Changing jobs annually is my specialty.

Lenders value stability. Frequent job changes can make them question your ability to meet long-term commitments like a mortgage. Aim to show at least two years of consistent employment.

7. This salary job isn’t for me; I’m going commission-based.

Switching to a commission-based or self-employed role during the loan process can complicate approval. Lenders need consistent, verifiable income to calculate your loan terms.

8. I’m getting a cash gift for my down payment.

Cash gifts can be acceptable, but they come with rules. Always disclose the source of the gift and follow your lender’s guidelines to ensure compliance.

9. So, foreclosure... how’s that work?

This might seem like an innocent question, but to a lender, it raises doubts about your ability to pay the loan. Save those questions for later.

10. What’s a credit score?

Knowing your credit score is foundational to the loan process. If you’re unfamiliar with how it works, consider improving your financial literacy and credit profile before applying.

At Locke Your Loan, we’re committed to helping you succeed at every step of the journey. By steering clear of these pitfalls and maintaining open, honest communication, you’ll position yourself for approval and the best possible loan terms. Let’s chat! Ready to discuss your homeownership goals? Reach out today and let us help you Locke Your Loan! Want more tips like this? Follow us on social media for expert advice and updates!