Be Prepared for Mortgage Lenders to Ask Intrusive Questions

Meeting with a mortgage lender to apply for a loan can feel an awful lot like a first date – a bit awkward, uncertain and nerve-wracking. This is magnified because mortgage lenders will ask plenty of questions that may seem nosy to you. Rest assured, lenders ask these intrusive queries with good reason.

How old are you? This question is certainly taboo in social circles, but it’s asked with purpose when you’re applying for a mortgage. Your credit report will be pulled to determine your loan risk, and knowing your age, birth date and name is the best way to ensure the lender pulls your credit report, rather than someone else’s who happens to share your name.

What is your marital status? No one likes to discuss divorce with a person they’ve just met, but a lender asks this question because it can be pertinent to your financial health. For example, if you’re paying out alimony or receiving payments from a former spouse, your financial picture – and how much house you can truly afford – changes.

Are you raising children? Lenders are prohibited from discriminating against mortgage loan applicants in any way, but knowing whether you have children in your home – including their ages – helps lenders know if you qualify for special programs, such as the 100% USDA Home Loan.

Have you been involved in a recent lawsuit? This question is designed to protect the lender. If you’re a plaintiff or defendant in a court proceeding, there is the possibility of monetary loss associated with a court ruling. Lenders always have to forecast whether you’re likely to default on payments, which can be directly affected by monetary court settlements.

With what ethnicity do you identify? You aren’t required by law to answer this question, but most lenders will ask for you to disclose your ethnicity anyway. This is because the federal government tracks patterns of discrimination in lending. Identifying your personal characteristics may help prevent unfair lending practices from affecting someone else’s American dream.

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