maria ziegler jJnZg7vBfMs unsplash

From Approval to Keys in Loudoun County: What NOT to Do After Mortgage Approval

Congratulations on getting your mortgage approved for your dream home in Loudoun County! This is an exciting step towards homeownership, but it's important to remember that the journey isn't over yet. After receiving that coveted mortgage approval, there are some critical things you should NOT do to ensure a smooth transition from approval to keys in hand.

Avoid Making Large Purchases

It’s understandable to feel the urge to start furnishing your new home or perhaps even splurging on a new car to park in the driveway. However, making large purchases using credit (or even large sums of cash you withdraw from your account), such as buying furniture, appliances, or a vehicle, can jeopardize your mortgage approval. Even though you may have been approved for a certain loan amount, any additional debt could impact your debt-to-income ratio and potentially lead to a denial or delay in closing.

Steer Clear of New Credit Applications

Once you’ve been approved for a mortgage, it’s crucial to maintain the status quo with your credit profile. Avoid applying for new credit cards, store cards, or any other type of credit, as each application generates a hard inquiry on your credit report. These inquiries can temporarily lower your credit score, which may affect your mortgage terms or even result in a denial of the loan.

zac gudakov AmGPbw3ZKR4 unsplash

Stay Current on Existing Payments

Your credit score plays a significant role in the mortgage approval process, and late payments can have a detrimental effect on your creditworthiness. Make sure to stay current on all existing payments, including credit cards, loans, and utilities. Late payments, even if they occur after mortgage approval, can signal financial instability to lenders and may raise red flags.

Avoid Opening or Closing Accounts

In the period between mortgage approval and closing, it’s essential to maintain stability in your financial accounts. Refrain from opening or closing bank accounts, as these actions can complicate the verification process for your lender. Similarly, avoid depositing large sums of cash into your accounts without a clear paper trail, as this may raise concerns about the source of funds.

jonathan cooper 0O2Pp6 mOkY unsplash

Steer Clear of Cosigning

While it may seem like a gesture of goodwill to cosign a loan for a family member or friend, it’s a risky move, especially after mortgage approval. Cosigning for a loan creates a legal obligation for you to repay the debt if the primary borrower defaults. Additionally, cosigning can impact your credit score and debt-to-income ratio, potentially affecting your ability to qualify for the mortgage or secure favorable terms.

Discuss Major Life Changes with Your Lender

Beyond the financial aspects, it’s important to communicate with your lender about any significant life changes that may occur between mortgage approval and closing. Events such as getting married, having a child or adopting, or other major life changes can impact your financial situation and may require adjustments to your mortgage paperwork. By keeping your lender informed, you can ensure that your mortgage remains on track and avoid any potential complications.

nathan dumlao 5BB atDT4oA unsplash

In Conclusion

As you navigate the final stages of the homebuying process in Loudoun County, it’s essential to exercise caution and avoid any actions that could jeopardize your mortgage approval. By following these guidelines and staying financially responsible, you’ll soon be turning the key to your new home with confidence and peace of mind.

Best Loudoun County Real Estate Agents

Following these steps, you can increase the value of your property ahead of a home sale, without breaking the bank. Why not start making improvements today! Your home will thank you for it. In the meantime, if you are thinking about selling your home or have any questions, please don’t hesitate to contact us. We’re always happy to hear from you.

Garrell Group Keller Williams Realty 703 599 1178 real estate professionals built on customer service dedication and teamwork. scaled