Loans By Kathy: Don't lose those keys

Don't lose those keys

Don't lose those keys!  Here is my advice if you are purchasing a new home.  We all know that the mortgage process is more difficult since the crash of the real estate market.

All of the reduced documentation, stated income loans are done.  EVERYTHING is full documentation.  This means, 2 years tax returns, pay stubs, W-2's, bank statement, asset statements, credit reports, IRS transcripts etc.  All of the documentation must be clear, legible copies.kathy sheehan

The one thing I always tell borrowers during the mortgage process is to not make any new purchases, do not increase the balances on your credit cards and yet, there are some that do not follow that advice.

Today, a buyer was notified that another credit inquiry during the underwriting process showed that there was a new car loan and that was not disclosed at the time of the application.


Now, the buyer doesn't have a new home.  Don't make this mistake. Don't lose those keys.


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Kathy Sheehan Senior Loan Officer






Bay Equity LLC

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11475 Great Oaks Way, Suite 350, Alpharetta, GA 30002

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The opinions and general information in this blog are soley those of Kathy Sheehan.  Specifics regarding an individual case should be discussed in detail with a loan professional.  For a confidential consultation, please feel free to contact me via phone or email.  All terms and conditions are subject to change.


Comment balloon 23 commentsKathy Sheehan • November 10 2012 08:11AM


Hi Kathy -- as many times as this is said, it cannot be said enough --- no surpise purchases during the home buying process --- buyers need to wait until they have received the confirming call that the transaction is complete to make that "necessary" purchase or they risk receiving the keys to their new home.  

Posted by Michael Jacobs, Los Angeles Pasadena Area Real Estate 818.516.4393 (Coldwell Banker Residential Brokerage) over 5 years ago

Michael, I think sometimes borrowers don't think we will find out.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) over 5 years ago

Yes we must inform our buyers that they cannot make large purchases until the the purchase is finished.

Posted by Elite Home Sales Team, A Tenacious and Skilled Real Estate Team (Elite Home Sales Team OC) over 5 years ago

If the purchase of a car means they can't get a mortgage then maybe they really could not afford it.

Posted by Erv Fleishman, Luxury Prop Specialist Realty Associates (Realty Associates) over 5 years ago

Even just a large increase in the balances can have the same impact.

Erv, its not to say that they wouldn't qualify for a mortgage, but it may not be the same amount.

Posted by Kathy Sheehan, Senior Loan Officer (Bay Equity, LLC 770-634-4021) over 5 years ago

Kathleen ... so many buyers still do not follow the instructions by the lender or their real estate agent!  This is the first thing we discuss during our buyer consultation meeting.  It is very important to make it clear to them about items that impact their ability to obtain a home loan!!

Posted by Dan Hopper, Denver Realtor / Author / Advocate/Short Sale (Keller Williams Realty Downtown LLC) over 5 years ago

It amazes me that buyers don't think of these things but then we made simply expect them to know more than they naturally would.  We should all make sure we remind buyers of the things NOT to do during the purchase process that can derail the whole thing,

Posted by Jenny Durling, For Los Angeles real estate help 213-215-4758 (L.A. Property Solutions) over 5 years ago

HI Kathy,

I have to have this conversation with all first time home buyer clients...and some still go do something to jeopardize thier new home purchase.  Great post.  Thanks and have a wonderful week!

By the way, we are in the process of discussing a Meet Up on the Southside on December 4th.  I will let you know for sure.  

Posted by Jordon Wheeler, J W Group Real Estate Sales and Service (The Jordon Wheeler Group) over 5 years ago

Thanks Kathy, sometimes I think that this memo needs to be sent to buyers every week during the home buying process.

Posted by Bob Crane, Forestland Experts! 715-204-9671 (Woodland Management Service / Woodland Real Estate, Keller Williams fox cities) over 5 years ago

Kathy, years ago I had a client pick me up in her new car to ride with her to closing. Thankfully that was a time when they didn't check everything a day or two before closing.

Posted by Connie Harvey, Realtor - Nashville TN Real Estate (Pilkerton Realtors) over 5 years ago

Are you 100 percent right or what !!! Good to see your post Kathy. Hope to see you at the next meet up

Posted by Charlie Ragonesi, Homes - Big Canoe, Jasper, North Georgia Pros ( over 5 years ago

You raise such a good point. We have had clients who almost loast a home because they had 1000s of dollars of outstanding parking tickets. You have to pay close attention when applying for a mortgage. 

Posted by Dana Hollish Hill, Lead Associate Broker (Hollish Hill Group, Keller William Capital Properties) over 5 years ago

I recently had a buyer who wanted to get all new furniture for the new house.  Uh, nope.  Her lender hadn't told her to put the credit cards "in the freezer".  Good thing it came up in casual conversation.

Posted by Don Sabinske, Sabinske & Associates Inc. (Don Sabinske, Sabinske & Associates Inc.) over 5 years ago

They can always sleep in their car, Kathy. Some folks never believe us when we tell them.

Posted by Toni Weidman, 26 Years Selling Homes in New Port Richey, FL (Sailwinds Realty) over 5 years ago


I know that's got to drive you NUTS!  I haven't had a buyer do that yet... will keep my fingers crossed.  

Seven or more years ago, when I was representing a seller, the buyers begged to move the closing up.  Come to find out, just after closing she quit one job and accepted another one.  She just didn't want to quit til she closed!  The other job was a great opportunity, but she didn't want to rock the boat.  

All the best, Michelle

Posted by Michelle Francis, Realtor, Buckhead Atlanta Homes for Sale & Lease (Tim Francis Realty LLC) over 5 years ago

Ohhhh, that is too bad.  Michelle's story was interesting, too.

Posted by Ron Marshall, Birdhouse Builder Extraordinaire (Marshall Enterprises) over 5 years ago

Good Morning Kathy: I find your information very useful and indeed very important. I have a buyer who failed to follow one of the guidelines. Hence, the dream of owning a home was stalled---maybe for a longer time.

I would like to share this with my buyers.



Posted by Maria Gilda Racelis, Home Ownership is w/in Reach. We Make it Happen! (Home Buyers Realty, LLC-Manchester, Bolton. Vernon,Ellington) over 5 years ago

Hi Kathy, This is valuable and important information.  There are some buyers that "get it" and others that don't.  Great post!

Posted by Linda Holloway, REALTOR®, Your Next Home in Tampa Bay Starts Here! (Keller Williams Realty Tampa Central) over 5 years ago

I had a story similar to Michelle's - we hired a gentleman that was buying a home and he gave his notice 2 weeks before closing!!  OH MY - he was so happy to tell me, but I was not happy and told him he could have ruined his chances to complete the purhcase.  THANKFULLY, he knew the person in HR very well and she pulled the letter and he was able to purchase and then quit!  It was a close call!!

Posted by Joy Daniels (Joy Daniels Real Estate Group, Ltd.) over 5 years ago

OUCH.... I hope they don't have to end up sleeping in their new car!  That would be a bad trade-off.

Posted by Georgie Hunter R(S) 58089, Maui Real Estate sales and lifestyle info (Hawai'i Life Real Estate Brokers) over 5 years ago

Ouch indeed! That is a MAJOR mistake and it is a shame that this happens so often because people don't know the difference.

Posted by Barbara-Jo Roberts Berberi, MA, PSA, TRC - Greater Clearwater Florida Residential Real Estate Professional, Palm Harbor, Dunedin, Clearwater, Safety Harbor (Charles Rutenberg Realty) over 5 years ago

Kathy, great post, and SO important for buyers to listen to the lender and their agent --- don't change anything or you will lose those keys!

Posted by Joan Cox, Denver Real Estate - Selling One Home at a Time (Metro Brokers - House to Home, Inc. - Denver Real Estate - 720-231-6373) over 5 years ago

This is something I always pound into my buyers heads.  A lot of times they want to do stuff like buy new appliances and apply for a credit card at the department store where they do that and spend thousands on new appliances that they now can't even use because they can't get the loan on the home.  They just don't think about it, but it's such a bummer.  -Kasey

Posted by Kasey & John Boles, Boise & Meridian, ID Ada/Canyon/Gem/Boise Counties (Jon Gosche Real Estate, LLC - about 5 years ago