Things to Stay Away From After Applying for a Mortgage

There are a few things to remember before closing once you’ve discovered your dream house and applied for a mortgage. It’s exciting to start planning your move and decorating your new home, but before you make any huge purchases, shift your money around, or make any major life changes, talk to your lender — someone who is equipped to explain how your financial actions may affect your house loan.Here’s what you shouldn’t do once you’ve applied for a mortgage. They’re all crucial to know — or at the very least, useful reminders – for the process.

1. Don’t put money in your bank account until you’ve spoken with your bank or lender.

Lenders need to know where your money came from, and cash is difficult to track. Before you deposit any money into your accounts, talk to your loan officer about how to properly document your transactions.

2. Don’t make any major purchases, such as a new car or home furnishings.

New debt entails new monthly responsibilities. New responsibilities necessitate new qualifications. The debt-to-income ratio of people with new debt is higher. Because larger ratios indicate riskier loans, qualified consumers may find themselves unable to obtain a mortgage.

3. Don’t cosign other people’s loans.

You are obligated if you co-sign. Higher debt-to-income ratios are also associated with this duty. Your lender will have to count the payments against you, even if you pledge you won’t be the one making them.

4. Keep your bank accounts the same.

Lenders must be able to locate and track your assets. When your accounts are consistent, this work becomes considerably easier. Speak with your loan officer before transferring any funds.

5. Do not seek new credit.

Whether it’s a new credit card or a new car, it doesn’t matter. Your FICO® score will be affected if you have your credit report run by firms in several financial channels (mortgage, credit card, auto, etc.). Lower credit scores can affect your interest rate and, in some cases, your approval eligibility.

6. Don’t close any of your credit cards.

Many purchasers assume that having less credit available reduces their risk and increases their chances of approval. This is not the case. Your credit history (rather than just your payment history) and overall credit usage as a percentage of available credit are both important factors in your score. Closing accounts has a negative impact on both of these score factors.


Any changes in income, assets, or credit should be assessed and addressed in such a way that your house loan is still authorized. Share any recent changes in your work or employment status with your lender as well. Before you do anything financial, it’s best to thoroughly disclose and discuss your goals with your loan officer.