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If you’ve found your dream space and negotiated the best price, you might assume everything is fine — especially if you’ve gotten all the paperwork in order, crossing your Ts and dotting your Is. However, the fact is that financing approval is based on the information provided at the time of application. A change in your financial situation during the mortgage process may impact your ability to receive a home loan. If you want to steer clear of any roadblocks on the path to buying your next home, here are five things to know about to ensure you have a smooth transaction.

Employment Changes

When you submit a request for financing, whether for a home or another large purchase, one of the most important things a lender looks at is your employment history. Your salary determines your ability to repay the loan, which is very important to any lender. If you’ve been earning a particular salary with one company but switch jobs during your buying journey, the lender may ask for a letter from your new employer to confirm your salary.

Another employment change that could affect your financing is going from an employee to a self-employed contractor. This is why many experts recommend holding off on any major employment changes until after the deal is finalized.

Down Payment Source

The source of your down payment changing is another issue that could affect your approval. It doesn’t matter whether the funding is coming from savings or a gift from family. A lender will want to know your source of down payment so they can factor it into your risk assessment.

Existing Debt

A lender will do a credit report check about one or two weeks ahead of the date of possession. This report will show any debts you hold. Since approval is partially based on how much you owe on a particular date, it’s best to hold off on any major purchases until after you take possession of your new home. And don’t be fooled by “don’t pay for X months” schemes — the lien will still show on your credit report, even if you aren’t required to make payments yet.

Credit Score

Credit cards are a major roadblock when it comes to mortgage approvals. It’s important to keep your credit score positive while you are waiting on approval or to take possession of your home. If your score falls as the result of late payments, it could cause major headaches with your financing.

Identity Documents

Before finalizing your mortgage, your identity documents will be verified to ensure they match the mortgage documents. It’s important that everything matches your legal name, even if you go by a nickname.

To avoid last-minute roadblocks with your mortgage application, it’s important to stay in touch with your lender throughout the process. If your situation changes after you file your application, advise them as soon as possible to ensure it doesn’t affect your approval. If you have any questions, please reach out to your HFG Licensed Mortgage Professional. We’re here to help!