Today, we’re going to talk about something super important in the mortgage business: the top five ways to derail your loan approval. Here are some common home loan pitfalls you need to watch out for:

1. Don’t take on any new debt. Any new debt will affect your debt-to-income ratio and can upset your loan approval.

2. Don’t buy or lease a new car. Changes to your debt-to-income ratio can happen and again upset your approval.

“Don’t take on any new debt and jeopardize your loan approval.”

3. Don’t let anyone pull your credit. Every time someone does that, it could cost you anywhere from three to 10 points, so don’t let it happen. 

4. Don’t change or quit your job. I know that sounds funny, but believe it or not, sometimes people do that and don’t think it will have any effect.

5. Don’t buy new furniture or appliances for the house. Even if the interest rate is zero for the first 18 months, we will have to count 5% per month of whatever debt that you took on during that process. 

The other thing that many people don’t realize is either the day of or the day before closing, we have to go in and take another soft pull on your credit to see if any new debt has been taken on. The truth is going to come to the surface immediately when we see that, and at the very least, your file will have to go back through underwriting again, so there will be delays. 

Just know that if you take on new debt, that could permanently upset your loan approval. You could lose your earnest money and any money you paid for your inspection and appraisal. Just wait to act until after you buy the home. 

If you have any questions about this topic, or about mortgage products in general, please feel free to reach out to me by phone call or email. I would be happy to help you with all of your mortgage needs.