First Time Homebuyer Guide 2022 | Page 17

Things To Avoid After Applying for a Mortgage

Once you ’ ve applied for a mortgage , there are some key things to keep in mind . While it ’ s exciting to start thinking about moving in and decorating , be careful when it comes to making any big purchases . Here ’ s a list of things you may not realize you need to avoid after applying for your home loan .
1 . Don ’ t Deposit Large Sums of Cash
Lenders need to source your money , and cash isn ’ t easily traceable . Before you deposit any amount of cash into your accounts , discuss the proper way to document your transactions with your loan officer .
2 . Don ’ t Make Any Large Purchases
It ’ s not just home-related purchases that could disqualify you from your loan . Any large purchases can be red flags for lenders . People with new debt have higher debt-to-income ratios ( how much debt you have compared to your monthly income ). Since higher ratios make for riskier loans , borrowers may end up no longer qualifying for their mortgage . Resist the temptation to make any large purchases , even for furniture or appliances .
3 . Don ’ t Co-Sign Loans for Anyone
When you co-sign for a loan , you ’ re making yourself accountable for that loan ’ s success and repayment . With that obligation comes higher debt-toincome ratios as well . Even if you promise you won ’ t be the one making the payments , your lender will have to count the payments against you .
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