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What to Do When Your Loan Falls Through


When the unthinkable, your loan doesn’t get final approval, happens, it can be a frustrating time.

After years of working for the credit score, saving pennies, being pre-approved for a mortgage, and finding the perfect house, it feels more than upsetting when your loan falls apart during escrow. While it is a difficult time, you only have a short period of time to regroup and reposition yourself to close the deal.

Firstly, you should ask your mortgage professional why your loan fell apart.

  • If the issue was the appraisal, work with your Realtor to ask the seller to reduce the purchase price.
  • If the issue was a change in lender guidelines, ask your mortgage broker whether they can submit your application to other lenders.
  • More down payment funds may be required if your debt-to-income ratio is too high. You may qualify for a Down Payment Assistance Program offered by your city or state.
  • You may be able to borrow from your retirement account if you’re still searching for down payment funds.
  • If your credit score has dropped, review the report to make sure that no fraudulent entries are dragging your score down. If there are, ask your mortgage professional how to go about correcting the report.

Be sure to ask your Escrow company for other financing options and services.

If these options aren’t available for you, then you can go back to the drawing board. You can house hunt at a reduced price range or take care of the items necessary to put you back in the position as a qualified buyer.

For great escrow services, visit Brighton Escrow in Hermosa Beach, California. We ensure that all of your escrow services are perfectly dealt with so that closing on your new home is straightforward, organized, and prompt! Contact us today!

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