With much financial discipline and prudence, you finally get a pre-approval on a mortgage, and you are one step closer to getting your dream home. Once you are at this stage of your planned home purchase, you need to wait things out and not do anything drastic to rock the boat and make yourself look less trustworthy to a lender.
You must stay connected with your lender and make available information, documents, and other requirements they may ask of you. If you respond timely and provide appropriate information as needed, the lender will develop a better impression of you, and this may help in speeding up the process of your loan application.
Harsh as it may sound, here is an emphatic list of DON’Ts that you must avoid during the period between your mortgage pre-approval and the closing on your new home.
DON’T Apply for New Credit
A mortgage loan is a large enough debt, so don’t think of adding more credit to pile more payables on your plate. New credit cards may change your financial profile, and your lender will take all these into account.
DON’T Miss Due Dates on Bills
Keeping at pace with your bills and payments will give you a stable financial image. This too, is great practice for when your mortgage payments come rolling in. Make it a habit to pay all bills on time.
DON’T Make Any Large Purchases
If you’re purchasing a home, focus on that one large responsibility and don’t make other large purchases that can shake your financial standing in the eyes of your creditor. Now is not the best time to consider buying a new car, new furniture, and home appliances. Those can wait until after you’ve inked a deal with a home seller.
DON’T Change Jobs
Stability in income flow is one of the key factors considered by lenders when they approve your loan. Changing jobs at this point, even if it’s for a higher-paying job, may cast doubts on your ability to pay for your loan.
DON’T Deposit Large Sums of Money Without a Paper Trail
Don’t make any unusual deposits or withdrawals at this time, which can make your lender suspicious. Any transactions above $200 outside of your salary should be disclosed to your loan officer, whether these are cash gifts from family or additional income from legitimate side hustles.
There is no need to be overwhelmed and anxious over these reminders. What is important for you to remember is that while you are waiting on your loan to be released after your mortgage pre-approval, you should not make any major financial changes that could change the landscape of your financial profile. When in doubt, talk to your trusted mortgage consultants for guidance.