During the loan process, there are many things that you should not do that could affect your approval.During the loan process remember to continue to pay credit related obligations on time. Late payments, especially to your mortgage, could result in your loan being denied!
Do not change or quit your job. Employment stability is one of the factors banks use to underwrite the risk of your mortgage. Changing employment can cause the mortgage application to be turned down, or at the very least, prolongs and complicates the loan process.
Make sure you do not begin construction on the property of any kind. An appraisal will be required and having construction on the property could hurt your ability to get a fair appraisal and may affect how much money you can lend on the home.
Even if you are thinking about making home furnishing purchases that are all 90 days same as cash, 12 months no interest, no payments for two years from date of purchase, etc... do not buy these before the financing is complete for your home purchase. These will still report to your credit and can negatively affect your loan approval. Don't let the sales reps. at the furniture stores tell you otherwise either, because they are working for a commission and just want to sell furniture and make their money. This is a very important item to make sure you do not do during the loan process, especially if your debt to income ratio is already a little on the high side. Another thing to not do during the loan process is, do not schedule appliance and furniture deliveries, landscapers, painters, home decorators, etc... to show up the day and immediately after you are supposed to close and get your keys to the new home. Unfortunately sometimes unexpected things happen and closings get pushed back hours and sometimes even days after the original close date. Sometimes if you are closing late in the day your mortgage may not be recorded until the next day and you may not get your keys until the next day. Sometimes your purchase agreement may state that you will not get your keys until 3 days after close or something along those lines so make sure you read your purchase agreement carefully and plan everything accordingly. You do not want to schedule any of these people to be at your house until a time when you are sure you will have full access to the home. This will save you money from possibly being charged trip charges or even more if they are unable to get access to the home when they are scheduled.
Many people have made the unfortunate mistake of buying their new home furnishings on credit. This is often a problem because the new lines of credit are probably at a high utilization, lowering your credit scores. Also, the new minimal monthly payment may disqualify you due to your higher debt to income ratio. Even if your loan has been approved the lender will check your credit report immediately prior to closing. Do not buy new furniture on credit until you have closed on your purchase and the keys to your new house are in your hands.
Do not do anything that could affect your credit profile such as apply for a new auto loan, credit card, cell phone, etc. Not only do you not want to take on any new debt, you do not want to have any inquiries report on your credit bureau. Unnecessary inquiries can drop your credit score, resulting in higher interest rates, or could possibly result in you not being able to qualify for the mortgage at all.
Another thing to avoid is allowing multiple lenders and or brokers pull your credit report repeatedly. If the credit pulls are not done within a certain period of time of each other it will drop your credit score.
