Getting approved for a mortgage is a big accomplishment for anyone. It means you’re ready to take on the responsibility of homeownership, but it’s important to remember that taking out a mortgage is not the end of the journey – it’s just the beginning. After you’ve been approved, you may be tempted to make big purchases or change jobs, but doing so could jeopardize your chances of closing on your new home. This blog post will discuss things to avoid after applying for a mortgage.
Do not change jobs!
A lender’s favorite word is stability! Stability includes a consistent employment history, and a job change can often cause loan denial or, at the very least, a delay in processing. If you plan on making a job change, do it before you begin the mortgage application process or after you close. Remember that lenders generally require you to be at your job for at least two years to qualify for a loan.
Do not make any large purchases!
A mortgage lender will pull your credit report at different stages of the loan process: when you first apply and before closing. Making large purchases between these stages could change your debt-to-income ratio and affect your ability to close the loan. So, no new cars or appliances until after you close your home!
Do not apply for new credit, and don’t close any credit accounts!
During the mortgage process, your credit score is subject to change. New credit applications can lower your score, and closing existing accounts can also negatively affect you. So again, no new cars or credit cards until after you’ve closed on your home!
Do not change your bank account!
Lenders like to see stability in your bank account, so resist the urge to close or open any new accounts while you go through the mortgage process.
Do not make large deposits!
Depositing a large sum of money into your bank account can cause concern for lenders. If you have a windfall, such as an inheritance or a tax refund, speak to your lender beforehand to find the best way to handle it.
Do not co-sign any loans!
Co-signing a loan for someone else can affect your debt-to-income ratio and may cause problems with your mortgage loan. So, if possible, avoid co-signing any loans while you’re in the middle of the home loan process.
In short, the best thing you can do after applying for a mortgage is to stay the course! Keep up with your payments, don’t make large purchases or changes, and avoid opening or closing accounts. Doing so will help ensure a smooth and successful mortgage process. Have real estate questions? Give the USA Real Estate team a call, we would love to help! (928) 775-0400