Exercise Caution With Your Credit During Home Purchase

It may not be wise to open additional credit cards or lines of credit during your home purchase.  Lenders will soon start to re-pull credit several days before closing.  Before, it was the lenders option to do so.  Now, if the borrower’s credit has gone down or the borrower has gone out and purchased a Jeep and no longer budgets, (It happened to me a number of years back and the lender re-pulled and the deal blew up) then Fannie can come back and say the lender didn’t use “Due Diligence” and kicked the loan back. 

It is critical that when borrowing for your home you understand that you should not do anything that may adversely affect your debt ratio or your credit during the transaction. 

Thanks to Andy McIinnes for this heads-up.  Andy is a loan officer at Umpqua Bank and can be reached at 775-247-2816 or andymcinnes@umpquabank.com.