What Not to Do After Applying for a Mortgage

Getting pre-approved is not the finish line. Your lender verifies your employment, credit, and assets again before closing, so the financial picture you applied with needs to stay the same until you have your keys. Here is what to avoid.

1. Don’t change jobs

Your lender verifies your employment again shortly before closing. Quitting, switching employers, or moving from salary to commission or self-employment can change whether you qualify. If a job change is coming, tell your loan officer before it happens. A move to a higher salary in the same field can often be worked through. A move to commission or self-employment usually cannot.

2. Don’t make large purchases

Hold off on furniture, appliances, and vehicles until after closing. A new payment raises your debt-to-income ratio and can put you over the limit for your loan. That includes “same as cash” and interest-free financing, which still show up as new debt.

3. Don’t open new credit accounts

Applying for a credit card, auto loan, or store financing adds an inquiry and a new account to your credit report. Either one can lower your score, and the lender will ask you to explain it.

4. Don’t close existing credit accounts

Closing an unused card can lower your score by reducing your available credit and shortening your credit history. Leave your accounts as they are until after closing.

5. Don’t miss a payment

Keep every bill current, including rent, car loans, credit cards, and student loans. A single late payment during the process can lower your score and change your approval.

6. Don’t deposit cash without documentation

Lenders must verify where the money for your purchase comes from, and cash can’t be traced. A large deposit with no paper trail will need a written explanation and documents, and it may not be usable at all. Talk to your loan officer before depositing cash.

7. Don’t move money without asking first

Lenders review your bank statements and need to follow the money. You will have to move funds for your down payment at some point, and that’s fine. Ask first, move it once, and keep the statements from both accounts so the transfer can be documented. Avoid opening or closing bank accounts during the process.

8. Don’t co-sign a loan for someone else

A co-signed loan counts as your debt, even if someone else makes the payments. It raises your debt-to-income ratio and can affect your approval.

9. When in doubt, ask first

If you’re unsure about a financial decision, call your loan officer before you act. Something that seems harmless can be the reason a loan is delayed or denied. Most problems can be solved if they’re raised early.

Frequently asked questions

Can I change jobs after applying for a mortgage?

It’s risky. Your lender verifies your employment again shortly before closing. A move to a higher salary in the same field can often be worked through, but a move to commission or self-employment usually cannot. Talk to your loan officer before you make any change.

Can I buy furniture or a car before closing?

Wait until after closing. A new loan or financed purchase raises your debt-to-income ratio and can change whether you qualify, even with interest-free financing.

Why does my lender ask about large deposits?

Lenders must verify the source of the money used for your purchase. A large deposit that doesn’t match your regular income needs a written explanation and documentation showing where it came from.

Does the lender check my credit again before closing?

Often, yes. Many lenders review your credit and verify your employment again shortly before closing, so new debt or a job change after pre-approval can affect your loan.

Next step

If you’re in the middle of a loan and aren’t sure whether something will cause a problem, ask me before you do it. Call 219-695-0369 or text me at 219-758-8072.

Get prequalified here or send me a message.

Related: Can you trust your mortgage pre-approval? and the home loan process, step by step.