Things to Avoid After You Apply for a Mortgage

Buying a home is an exciting milestone, but the mortgage process can be delicate. Once you've applied for a mortgage, your financial behavior plays a critical role in whether you secure loan approval. Small missteps can lead to delays, increased interest rates, or even loan denial.

In this comprehensive guide, we’ll explore the top things to avoid after you apply for a mortgage and how to protect your financial standing until you close on your dream home.

Understanding the Mortgage Approval Process

What Happens After You Apply?

After submitting your application, your lender begins an in-depth review of your financial profile, which includes your:

• Credit score and credit history

• Employment and income verification

• Current debt and liabilities

• Assets and account balances

• Mortgage pre-approval status

This stage, called underwriting, determines whether your application is approved or rejected.

Why Your Actions Matter

Your lender continues to monitor your finances through closing. Even if you’ve been pre-approved for a mortgage, last-minute financial shifts can prompt reevaluation—or even denial—of your loan.

1. Don’t Change Jobs or Employment Status

Why Job Changes Can Be Risky

Changing employers or becoming self-employed may create uncertainty about your income stability. Lenders may pause your application to reverify income and employment.

What If the Change Is Necessary?

If you must change jobs, inform your lender immediately. Provide new offer letters, pay stubs, or contracts to prove stable income.

2. Don’t Make Major Purchases

Avoid Buying Furniture or Appliances on Credit

It might be tempting to start decorating your new home early, but large purchases—especially on credit—can increase your debt and disrupt your credit utilization ratio.

Car Loans and New Credit Accounts Are a No-Go

Opening new credit lines or financing a vehicle can throw off your debt-to-income ratio, putting your mortgage at risk.

3. Don’t Miss Bill Payments

Your Credit Score Still Matters

Late payments on loans, credit cards, or utility bills can negatively affect your credit score and raise red flags during underwriting.

Automate Your Bills

To stay on track, consider setting up auto-pay for recurring bills.

4. Don’t Make Large Deposits Without Documentation

Lenders Need a Clear Paper Trail

Unexplained deposits may trigger suspicion that you’ve borrowed money for your down payment, which can lead to delays or denials.

Always Provide Proof

If a family member gives you a financial gift, you’ll need to provide a signed gift letter and bank documentation to satisfy underwriting guidelines.

5. Don’t Co-Sign Loans for Anyone

It’s Still Your Debt

When you co-sign for a loan, lenders count that financial obligation against you—even if someone else is making the payments.

Wait Until After You Close

Co-signing can be generous, but it should wait until your home loan is finalized.

6. Don’t Close or Open Credit Accounts

Closing Accounts Can Backfire

You might think you're helping by closing unused credit cards, but this reduces your credit history and increases your credit utilization ratio.

Opening New Accounts? Don’t.

Applying for new credit cards or loans results in hard inquiries, which can lower your credit score just when you need it to be strong.

7. Don’t Transfer Large Sums Between Accounts

Avoid Unnecessary Confusion

Large account transfers may trigger additional documentation requests and delay your loan approval.

Use a Single Account

Try to use one primary account for transactions that relate to your mortgage and home purchase.

8. Don’t Ignore Lender Requests

Respond Promptly

Lenders may ask for updated documents or clarification. Slow responses can delay your closing date.

Stay Accessible

Keep communication lines open and check your email regularly for lender correspondence.

9. Don’t Make Changes to Your Loan Application

Stick With Your Original Information

Even positive changes, like an increase in income or a financial gift, can require re-underwriting.

Review Carefully Before Submitting

Before you submit your application, double-check that all the information is accurate and complete.

10. Don’t Apply for Other Loans

Too Many Inquiries = Risk

Every new credit application counts as a hard inquiry. Several inquiries in a short period can lower your score and raise concerns about financial overextension.

Focus on One Goal at a Time

Wait until after closing to consider other forms of financing or credit expansion.

11. Don’t Change Your Spending Habits

Lenders Watch Your Patterns

If your spending habits shift dramatically, lenders may question your ability to repay the loan.

Stick With What You Presented

Continue living within the budget you provided in your application.

12. Don’t Skip the Final Credit Check

Yes, It’s Real

Lenders often perform a final credit pull before closing. Any last-minute changes to your financial profile could derail the loan.

Stay Steady Until Closing Day

Avoid changes to your credit activity until the mortgage process is fully complete.

13. Don’t Overlook Closing Costs

Budget Beyond the Down Payment

Most buyers focus on saving for a down payment, but closing costs (typically 2–5% of the home’s price) are often overlooked.

Review Your Loan Estimate

Work closely with your agent or loan officer to ensure all fees and costs are clearly disclosed. You can also explore options through our available properties to plan your budget accordingly.

14. Don’t Assume Pre-Approval Means Guaranteed Approval

Pre-Approval Is Not a Final Decision

Getting pre-approved is an important step, but it’s not a guarantee. Your final approval depends on consistent financial behavior and successful underwriting.

Keep the Momentum

Treat your financial profile with care until you sign the closing documents.

15. Don’t Forget to Lock in Your Interest Rate

Protect Against Market Volatility

Mortgage interest rates fluctuate daily. Failing to lock your rate can lead to unexpected costs.

Ask About Rate Lock Options

Speak with your lender about rate lock programs to ensure stability throughout the process.

Bonus: Work With a Team That’s Got Your Back

Choosing a knowledgeable real estate team is one of the best ways to avoid pitfalls during the mortgage process. Whether you're a first-time home buyer or selling your current property, RE Solutions XV has the tools, experience, and support you need.

Considering leasing or referring a property owner? Check out our Owner Referral Program and Apply Now to start your journey confidently.

Frequently Asked Questions (FAQ)

How long does mortgage approval take?

The process usually takes 30–60 days, depending on how quickly you provide required documents and how complex your finances are.

What happens if I change jobs before closing?

This could affect your mortgage approval. Let your lender know as soon as possible so they can verify the new employment.

Can I use gift money for a down payment?

Yes, but you'll need proper documentation. Ask your lender what’s required.

Should I pay off all my debt before applying?

It depends. Consult your lender or a financial advisor before making major financial moves.

Final Thoughts

Once you’ve applied for a mortgage, your next move should be… not moving financially. Your lender is watching for red flags, and the smallest misstep could jeopardize your loan.

By following the guidance in this article—and working with a reputable team like RE Solutions XV—you’ll put yourself in the best position to close on your home quickly and confidently.