5 Things to be Honest with your Mortgage Broker About

Applying for a mortgage is a big step, and honesty truly is the best policy. Let's chat about five key areas where being upfront with your mortgage broker is crucial:

1. Your Down Payment Source

Transparency about where your down payment is coming from is essential. If family or friends are chipping in, let your lender know. They might require a signed letter stating the funds are a gift and not a loan. If it's a loan, this affects your financial obligations and needs to be disclosed.

2. Who Will Live in the Home

Planning to rent out the property instead of living in it yourself? Be upfront about it. Investment properties often come with different loan terms, including higher interest rates and larger down payment requirements. Misrepresenting this can lead to serious consequences.

3. Your Employment and Income Details

Lenders look for stable employment history, typically at least two years. Avoid the temptation to exaggerate your job tenure or income. Lenders verify this information, and discrepancies can derail your application.

4. Existing Debts and Financial Obligations

It's crucial to disclose all existing debts, including personal loans, credit card balances, and any other financial commitments. Lenders assess your debt-to-income ratio to determine your ability to manage additional debt. Hiding obligations can lead to loan denial or future financial strain.

5. Credit History

Be honest about your credit history, including any past bankruptcies, foreclosures, or late payments. Lenders will review your credit report, and undisclosed issues can harm your credibility and chances of approval.

Remember, lenders are there to help you find a mortgage that fits your financial situation. Being transparent ensures they can provide the best assistance possible. Honesty not only increases your chances of approval but also sets the foundation for a trustworthy relationship with your lender.