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The 3 Most Common Typos Found In A Mortgage Application

In any type of application, there is generally some type of paperwork that needs to be filled out. Whether it be for a job, to receive a license, or for college, in each application, it is essential to fill out the paperwork correctly. Though you may not be a person who pays attention to the details, applications require a person to pay attention to detail. Not filling out the paperwork correctly can have consequences.

When applying for a mortgage, the consequences of not filling out the paperwork correctly are going to be costly. Therefore, in this type of application, it is even more essential to take the process slowly, meticulously, and without mistake. One of the easiest mistakes to make on the form is making a typo.

Here are the 3 most common typos found in a mortgage application that you should be aware of.

Misspelling your name. 

This one could come as a shocker. Among all the necessary steps, writing out your own name may seem like the easiest. However, because of people having nicknames and hyphenated names, there is sometimes uncertainty on which name should be used. No matter what name you go by, the name that you should use is your official legal name.

What are the consequences of not using your legal name? If you do not use your legal name, you risk there being confusion among the companies that determine the details of your mortgage.

When you apply for a mortgage, that information is first passed from the loan professional to credit-reporting agencies. The lender then receives a credit score from each of the credit-reporting agencies: Experian, TransUnion, and Equifax.

Each of these credit-reporting agencies keeps track of different aspects of your financial responsibility. Therefore, each company is going to have a separate report.  However, there will be a discrepancy in your report if each one has a different name. This could result in an incomplete credit report, where your credit score may be increased, causing you to have a larger loan and higher interest. Or, the lender may not be provided with a score from each of the three credit-reporting agencies.

Technically, a lender only needs one of the credit-reporting agencies to provide a score. But, not all lenders are going to continue to process your application if they do not have all three scores. Some may process it but give you a larger loan and higher interest. The best way to ensure that this never happens to you is by making sure that you use your official legal name in any type of documentation you do.

Address inconsistencies

This is one of the more tricky aspects of the mortgage application process. When applying for a mortgage, you are going to be asked to provide the address of where you have lived over the last two years. If you have lived in the same address, it will be much easier for you. You are just going to make sure that you spell and type every aspect of your address correctly.

However, if you have moved around a couple of times, there is going to be more information that you are going to have to be sure to provide accurately. Any inconsistency in any of the addresses you previously lived at is going to be a red flag.

A red flag is going to make it harder for you to obtain a loan and most definitely obtain a loan that has a low cost and interest rate.

A misreported Name Affidavit 

At the end of a mortgage application, a borrower is going to have to fill out a Name Affidavit. This document is also known as a Certificate, AKA Statement, Same Name Affidavit, or Signature Affidavit.

The Name Affidavit is used for the benefit of both the lender and the borrower. The borrower will give authentication of any variations of his or her name. Therefore, if the borrower has used a different name for various financial documents and the credit reporting companies have a different name listed, the Name Affidavit can be used to verify that the variations in the name are, in fact, the same person.

The primary use for the Name Affidavit is to ensure that the borrower can never back away from his or her loan or liability. If the borrower refuses to be bound by the loan or liability, the lender can use this document to prove that the borrower is the person bound by the loan and liability. Any mistakes in the names that the borrower uses could be costly for both the borrower and the lender.

The best way to ensure that you never have any problems during the mortgage application process is by verifying the information you need to provide before you actually apply. Check the name and address you previously used on your tax returns, birth certificate, credit card, and passport. Then, get your free credit report and double-check the information written on it.

Errors in credit reports are common. If there are any problems, make sure they are fixed. By checking your credit report before your credit is examined, you are going to set yourself up to receive a lower loan and a lower interest rate. Once you have checked all of your information before you apply, the next thing to do is double or even triple check all of the information you provide on the actual application.

You do not want to be someone caught making one of the above mistakes. It is just going to make the mortgage process more complicated.

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