What Not to Do After Home Loan Pre-Approval

Discover the common mistakes to avoid after receiving pre-approval for a home loan.

Taking on New Debt

One of the most important things to avoid after getting pre-approved for a home loan is taking on new debt. This includes applying for new credit cards, taking out personal loans, or financing a new car. Underwriters look closely at your debt-to-income ratio, and any new debt can negatively impact your ability to qualify for the loan or affect the terms of the loan. It's best to wait until after the loan is closed to take on any new debt.

Changing Jobs or Income

Another mistake to avoid is changing jobs or experiencing a significant change in income. Lenders want to see stability and consistency in your employment and income. Changing jobs or experiencing a decrease in income can raise concerns for underwriters and may affect your loan approval. It's important to maintain your current job and income until after the loan is closed.

Making Unnecessary Large Transfers of Money into Bank Account

Lastly, it's important to avoid making unnecessary large transfers of money into your bank account after getting pre-approved for a home loan. Lenders scrutinize the source of funds to ensure they are legitimate and not borrowed money. Large transfers of money can complicate the underwriting process and delay the loan approval. It's best to keep your bank account stable and avoid any suspicious or unnecessary transfers until after the loan is closed.