10 Mistakes to Avoid Once You Are Pre-Approved

Getting pre-approved is a really important first step in getting into your dream home. But it doesn't necessarily mean it's all in the bag. Here are a few of the most critical mistakes to avoid once you've secured that pre-approval.

  1. Changes in your income
    Now is not the time to tell your boss "to take this job and shove it." The amount you qualified for in your pre-approval is based on your two-year employment history. If you change jobs, you may be required to document thirty days or more with your new employer before you are able to get final approval on the home loan.
  2. Changes in your expenses
    Your pre-approval takes into account your total income as it relates to your monthly expense obligation. Adding a car payment or increasing your revolving credit may impact the total amount a lender is able to offer.
  3. Late or missing payments
    Few things will adversely affect your credit score more quickly than being late on payments, especially an existing mortgage payment or being excessively late (more than 30 days) on revolving credit or car loans.
  4. Unexplainable large cash deposits
    While many loan programs allow for gifts to help with down payment money, thorough documentation of large deposits will be required. Keep a paper trail so that it's easy to explain all activity in your bank account.
  5. Underestimating the importance of a good real estate agent
    Knowledge in the marketplace is probably one of the most important things an agent can offer you but it's also important to have a connection with the person you choose. Someone who understands what you want in a home can help narrow the search and even show you areas you may not have known about. When it comes time to make an offer and negotiate with the seller, you definitely want somebody with a strong understanding of property values in the area.
  6. Falling for your first
    Resist the temptation to make an offer on the first home you like. Shop around and take your time; this is one of the biggest financial decisions in your life. Also, take time to become an expert in the area you're looking. Get to know the home values in the neighborhoods you are considering and ask your Realtor for the sales price of homes that have recently sold in those areas.
  7. Getting distracted by cosmetics
    A fresh coat of paint and new carpet may look great, but if the house next door is priced less, you often can get a better deal by buying the less expensive home and painting the walls yourself.
  8. Failing to plan for additional expenses
    If you're like most people, soon after moving into the home, you'll be confronted with a long list of needs and wants. Keep this in mind when negotiating and considering your total monthly payment.
  9. Not keeping your lender in the loop
    When you are ready to make an offer, it's a good idea to circle back with your loan officer and review what your payment will look like based on your real scenario.
  10. Forgetting to enjoy the moment
    When you're in the thick of it, it's easy to get overwhelmed by all of the moving parts but this is the start of a new chapter in your life. Take lots of pictures and also take time to enjoy the process--most people look back on it with fond memories.