Do’s and Don’ts When Applying for Your Mortgage

If you’ve just applied for a mortgage–or are getting ready to do so–you probably know what to do ahead of your application, to ensure your financial house is in order. But what about after you’ve submitted your application? 

You may be surprised to learn there are some important do’s and don’ts for how you address your spending and income, even after you’ve made your mortgage application. In some cases, your actions could put your home purchase in jeopardy. Here are just a few guidelines to follow when applying for a mortgage. 

Do this…

• Be ready ready to provide any requested documents, including income verification, to the lender as requested. 
• Provide copies, but keep original documents for your own files so you can easily access the information. Alternatively, know how to access this information online. 
• Continue to use your credit cards as you normally would, but avoid carrying balances that reflect greater than 30% of your available credit. 
• Continue to work for your current employer. 
• If you do experience any change related to your employment, notify your loan originator immediately. Such a change could include termination, as well as pay raises, transfers, promotions, including pay raises, promotions, transfers, layoffs or terminations.
• Be sure you stay current on any bills. This includes your existing mortgage, if any.
• Keep in mind that your credit is monitored up to the day of closing.
• If your new mortgage is contingent upon the sale of your existing home, provide any documents necessary regarding its sale.

But don’t do this…

• Open or close bank accounts unless you have checked with your loan originator.
• Deposit sizable amounts of money into your account, other than payroll deposits, without telling your loan originator. If you are trying make a large deposit due to having sold some personal property, there is specific documentation to file. 
• Change careers, change jobs, quit your job or become self-employed.
• Start buying that new furniture or making other large purchases, including vehicles. These could impact your loan qualifications. 
• Open new credit cards.
• Use your credit cards to make a large purchase, increase the amount of money you’ve borrowed against a line of credit or otherwise incur debt.
• Open a new cell phone account without mentioning it to your lender.
• Omit any debts or liabilities when making your loan application.
• Spend your down payment on something else.