Things You Should Avoid After Applying For a Home Loan

You’ve done everything right so far; you’ve found a great lender, received a pre-approval, and submitted your loan package for final approval. Now you’re done, right? Wrong. Until you close on your new loan, it’s more important than ever to keep your credit steady. Most lenders perform one last credit check right before funding, and a decline in your score can mean the difference between getting the home and losing the loan.

Things You Should Never Do After Applying for a Loan

• Don’t Change Jobs – While sometimes unavoidable—especially if a career move is the reason for relocating—any change in income or employment status introduces risk and should be avoided whenever possible.
• Don’t Make Large Purchases – As tempting as it may be to shop for new furniture, wait until after closing to make significant purchases. This applies to furniture, appliances, and new cars. Taking on new debt alters your debt-to-income ratio and can disqualify you from your loan.
• Don’t Apply for New Credit – Every hard inquiry on your credit report can impact your credit score. This is not the time to open store credit accounts or search for a new credit card.
• Don’t Close Any Credit Accounts – It might seem counterintuitive, but closing accounts or paying off certain loans can actually lower your FICO score. The length of your credit history positively impacts your overall score.

The bottom line is to keep your credit and finances as static as possible until your transaction closes. If you’re unsure whether a financial decision could impact your qualification, consult your lender first to ensure a smooth path to closing.