Mortgage Approved? 10 Mistakes That Could Put Your Closing at Risk
July 10, 2026 | Posted by: Keith Leighton
Mortgage Approved? 10 Mistakes
That Could Put Your Closing at Risk
Receiving mortgage approval is an exciting milestone, but it does not always mean the financing process is completely finished.
Until the mortgage has closed and the funds have been advanced, your lender may still review your employment, credit, debts, down payment and supporting documents. A significant financial change before closing could affect the approval, delay the transaction or, in some cases, put the purchase at risk.
The period between mortgage approval and closing is not the time to make major financial decisions without first speaking with your mortgage broker.
Here are 10 mistakes homebuyers should avoid before closing day:
1. Financing or Leasing a Vehicle
A new car loan or lease can significantly increase your monthly debt obligations.
Mortgage lenders calculate how much you can afford based partly on your total monthly debt payments. Adding a vehicle payment after receiving mortgage approval could push your debt ratios above the lender’s acceptable limits.
Even when the vehicle payment seems manageable, it may reduce the amount you qualify to borrow.
Before financing or leasing a vehicle, speak with your mortgage broker and confirm that it will not affect your approval.
2. Opening New Credit Accounts
Applying for a new credit card, line of credit or retail financing account can affect your credit profile.
A new credit application may:
• Create a credit inquiry
• Reduce your credit score
• Increase your available borrowing
• Add a new monthly payment
• Raise concerns during a final lender review
This includes promotional offers such as no-payment furniture financing or store credit cards opened to purchase items for the new home.
It is usually best to wait until after closing before applying for new credit.
3. Increasing Your Credit Card Balances
Large purchases made before closing can increase your minimum monthly payments and change your debt-service ratios.
Common examples include:
• Furniture
• Appliances
• Electronics
• Renovation materials
• Moving expenses
• Travel
• Home improvement deposits
Using a credit card for these purchases may seem convenient, but a higher balance can affect both your credit score and your mortgage qualification.
Try to keep credit card balances stable or reduce them while waiting for the mortgage to close.
4. Missing or Delaying Payments
A missed payment can have a serious effect on your credit report, especially when it happens shortly before closing.
Continue making every payment on time, including:
• Credit cards
• Vehicle loans
• Lines of credit
• Student loans
• Personal loans
• Existing mortgage payments
• Utility accounts that report to the credit bureaus
Setting up automatic payments can help prevent an accidental missed payment during a busy moving period.
5. Changing Jobs Without Seeking Advice
Changing employers before closing may cause the lender to reassess your income and employment stability.
This can become more complicated if the new position includes:
• A probationary period
• Fewer guaranteed hours
• Commission income
• Contract employment
• Temporary employment
• A lower salary
• A different industry
A job change is not always a problem, but it should be discussed before any decision is made.
The lender may require a new employment letter, recent pay records or additional proof of income.
6. Reducing Your Hours or Leaving Your Job
Any reduction in income can affect the mortgage approval.
This may include:
• Moving from full-time to part-time employment
• Taking unpaid leave
• Reducing scheduled hours
• Leaving a position before starting another
• Switching to self-employment
• Retiring earlier than planned
Your approval was based on the income and employment information provided to the lender. A material change may require the lender to review the application again.
Contact your mortgage broker immediately if your employment situation changes.
7. Co-Signing for Someone Else
Co-signing a loan, vehicle financing agreement, credit card or line of credit can create a financial obligation in your name.
Even when the other person plans to make every payment, the lender may still include that debt when calculating your mortgage qualification.
Co-signing can also affect your credit and reduce your future borrowing capacity.
Wait until after closing and seek professional advice before agreeing to co-sign for another borrower.
8. Moving Down Payment Funds Without Keeping Records
Lenders are required to confirm where your down payment came from.
Moving funds between accounts can make the paper trail more difficult to follow, especially when money is transferred through several accounts or financial institutions.
Keep clear records of:
• Bank transfers
• Investment withdrawals
• Gifted funds
• Property sale proceeds
• Registered account withdrawals
• Large deposits
• Transfers between joint and personal accounts
Avoid withdrawing large amounts of cash or moving funds unnecessarily.
Your mortgage broker can help explain what documents the lender may need.
9. Making Large Unexplained Deposits
A lender may ask for documentation supporting any large or unusual deposit appearing in your bank account.
This is part of the lender’s responsibility to verify the source of the down payment and ensure that the funds were not borrowed without disclosure.
Examples may include:
• Cash deposits
• Transfers from family members
• Proceeds from selling a vehicle
• Insurance settlements
• Investment redemptions
• Business income
• Tax refunds
• Transfers from another financial institution
Keep receipts, statements, sale agreements and other records that explain where the money came from.
10. Spending Money Reserved for Closing Costs
The down payment is not the only money required to complete a home purchase.
Buyers may also need funds for:
• Legal fees
• Land transfer or deed transfer taxes
• Property tax adjustments
• Home insurance
• Title insurance
• Appraisal fees
• Inspection costs
• Moving expenses
• Utility deposits
• Immediate repairs or maintenance
Spending too much before closing could leave you without enough money to complete the transaction.
Keep your closing funds accessible and avoid committing them to furniture, renovations or other purchases until the transaction is complete.
Other Changes You Should Report
Contact your mortgage broker promptly if any of the following happen before closing:
• Your employment changes
• Your income decreases
• You take on new debt
• You miss a payment
• Your down payment source changes
• You receive gifted funds
• Your closing date changes
• The purchase price changes
• The property details change
• You plan to add or remove a borrower
It is always better to ask before making a financial change than to discover a problem shortly before closing.
A Mortgage Approval May Still Have Conditions
Many mortgage approvals include conditions that must be satisfied before the lender releases the funds.
These conditions may involve:
• Income verification
• Employment confirmation
• Down payment documents
• Property appraisal
• Proof of home insurance
• Confirmation that debts have been paid
• Updated bank statements
• Legal documentation
• Final review of the purchase agreement
Responding quickly to document requests can help prevent unnecessary delays.
Do not assume that a request is unimportant simply because the mortgage has already been approved.
What Should You Do Between Approval and Closing?
The safest approach is to keep your financial situation as stable as possible.
Continue to:
• Pay every bill on time
• Maintain your employment
• Avoid new debt
• Keep credit card balances under control
• Preserve your down payment and closing funds
• Keep financial records organized
• Respond promptly to document requests
• Contact your mortgage broker before making major changes
Protect Your Mortgage Approval
Mortgage approval is an important step, but closing day is the finish line.
A vehicle purchase, job change, new loan or unexplained transfer may seem unrelated to your mortgage, but it can affect the lender’s final decision.
The best way to protect your approval is to avoid major financial changes and stay in contact with your mortgage broker throughout the process.
At Ideal Mortgage, we help guide clients from the initial application through to closing. Before making a major financial decision, reach out to our team so we can help you understand how it may affect your mortgage.
