5 Ways To Get Your Mortgage Application Declined
Mortgage Broker
Michael Wolff Mortgage Broker
Published on November 5, 2019

5 Ways To Get Your Mortgage Application Declined

“Declined” is not a word anyone ever wants to hear. Especially when it comes to a mortgage application because buying a home is such a huge milestone. If you want to avoid having yours declined, make sure you don’t do any of the following things.

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Not Speaking To Your Loan Officer

Avoid this one at all costs. Your lender can pull the plug at any moment, so getting their approval before doing anything is essential for success. They want to lend you money (and get their payoff from interest rates), so they want to advise you. 

Making Huge Purchases

Purchasing a home is enough for the moment. Yes, you may want to get nice furniture and fancy car to go along with it, but these things can wait. Making large purchases can do a number of things to make your application look bad, such as reducing the amount of your down payment or changing your credit score. Don’t risk it, and just wait until you’re in the clear.

Doing Anything To Affect Your Credit

This should go without saying, but we’re definitely going to say it. You were approved for financing based on your credit profile and scores. Changing either of these gives the lender the right to decline your application. If you don’t want to rock the boat then avoid: paying off charge offs or collections, applying for loans, applying for new credit, skipping payments, etc.  Common sense plays a factor here.  

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Getting A New Job

Aside from your credit score, your application or pre-approval is also based on your income and also SOURCE of income. This Forbes article points out that changing jobs can complicate paperwork and create confusion. Switching jobs could also restructure how you get paid, which can be an issue for underwriting.

Now, don’t let that scare you away from getting that job of your dreams. Just be aware that you may come across issues. And please, talk to your loan officer first!

Doing Weird Financial Stuff

If that headline isn’t as self-explanatory as it’s meant to be, let me explain. Most of the factors that go into your application have to do with your financial and credit situations, right? So doing anything with your banking (AKA financial stuff) that you don’t normally do can be a red flag. This includes opening new accounts and making large, irregular deposits. 

Check out this video for more tips to avoid having your mortgage application denied:

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Michael Wolff Mortgage Broker
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