You have applied for your mortgage; your lender has verified your employment history, income, bank funds and credit report, and has now issued you your mortgage pre-approval letter. Now that you have your mortgage pre-approval letter, please don’t:
go out and buy new furniture
buy or lease a new car
apply for any other loans
open a credit card account
co-sign on a loan
or do anything else that can change your income to debt ratio, savings account balance or your credit score. Any change can make it harder for you to obtain the loan you had been pre-approved for.
Just because you have your mortgage pre-approval letter in hand doesn’t mean it’s a done deal. It is not unusual for a mortgage company, just before your closing, to again run a credit report, verify your employment and bank funds; and any change in these can cause BIG problems! Large purchases or an increase of debt before the loan is finalized can jeopardize your credit score and endanger the mortgage you had been approved for.
So remember, once you receive your mortgage pre-approval letter, play it safe and do not make any financial or employment changes. Once the closing on your home purchase has taken place – then you can celebrate!