Buying a home is a huge milestone—one that’s exciting, life-changing, and yes, sometimes a bit overwhelming. Whether it’s your first house or your forever home, chances are you’ll need a mortgage to finance it. And while getting a loan might feel like just another step in the process, the decisions you make before and during your mortgage application can significantly impact your financial future.
To help you navigate the process with confidence, here are ten common (and costly) mistakes that borrowers in Altamonte Springs should avoid when applying for a mortgage.
1. Not checking your credit report
Before you start the process of house hunting, check your credit report. Your credit score affects everything from your loan approval to the interest rate you will be offered. Your credit score is calculated based on your credit history, payment history, and credit utilization and small inaccuracies or overlooked debt can drag your score down and cost you thousands over time. Improving your credit score by correcting these mistakes can increase your chances of getting approved for a mortgage. Review your credit report from all three major bureaus, dispute any errors, and work on boosting your score if needed—it is worth the effort.
2. Not shopping around for rates
One of the most common mistakes borrowers make is accepting the first mortgage offer they receive. The interest rate on your mortgage can have a significant impact on your monthly payments and the total amount you will pay over the life of the loan. Even a small difference in interest rates can mean thousands of dollars in savings or additional costs over the life of the loan. Different lenders have different rates, fees, and terms, so it is crucial to do your research and compare.
You can start by getting quotes from multiple lenders and comparing their interest rates, closing costs, and other fees. You can also use online mortgage calculators to compare different loan scenarios and see how they affect your monthly payments and total costs. Keep in mind that shopping around for interest rates can take time and effort, but it can save you a significant amount of money in the long run. By doing your due diligence and comparing lenders, you can find the best mortgage that fits your needs and budget.
3. Not getting pre-approved
Getting pre-approved shows sellers that you’re a serious buyer and it helps you find a home within your actual budget. A pre-approval not only gives you clarity on what you can afford but also puts you in a stronger position when making an offer, especially in a competitive Altamonte Springs market.
4. Taking on new debt
Thinking about buying a new car or financing furniture before your mortgage closes? Hold off. One of the biggest mistakes borrowers make is taking on new debt before or during the mortgage application process. New debt can throw off your debt-to-income ratio and lower your credit score, putting your loan approval at risk. The best option is to stay financially steady until after closing day.
5. Not having enough savings
Beyond the down payment, buying a home involves other expenses—closing costs, moving expenses, and unexpected repairs, to name a few. Make sure you have a solid savings cushion so you are prepared for unexpected expenses.
6. Not disclosing all financial information
When applying for a mortgage, transparency is key. Lenders rely on a complete picture of your finances to assess your ability to repay the loan. Missing information can delay the process or lead to a denial altogether. Be upfront with your lender from the start — they can help you navigate your options more effectively when they have all the facts.
7. Making large purchases before closing
Once your loan is in motion don’t splurge on that new car or load up your credit card with furniture for your future home. Major purchases before your mortgage closes can shift your debt-to-income ratio or affect your credit score just enough to put your loan approval at risk. Hold off on large expenses until after the keys are in your hand.
8. Not understanding the terms of the loan
Your mortgage isn’t just a monthly payment—it’s a long-term commitment. Make sure you understand the interest rate (fixed or variable?), payment schedule, loan term, and any associated fees. If anything is unclear, ask questions before you sign. No question is too small.
9. Co-Signing a loan for someone else
Even with the best intentions, co-signing on another person’s loan adds debt to your name. That can hurt your debt-to-income ratio and complicate your mortgage approval. If you’re applying for a mortgage, it’s best to wait on helping someone else financially.
10. Changing Jobs Mid-Process
Stability matters to lenders. Even if the new job pays more, switching employers during your loan application can cause delays or red flags. If possible, hold off on any job changes until after your loan closes.
The mortgage process doesn’t have to be stressful. With a bit of preparation and the right guidance, you can avoid common pitfalls and move forward with confidence. Whether you’re buying your first home or your next home in Altamonte Springs, we’re here to help make it easier. Reach out to us today to find out how we can help! (813) 867-5757
Want to make the smartest move for your situation? Compare your home selling options here—and see what makes the most sense for your goals and timeline.