Buying a home is exciting, but the time between your mortgage approval and possession day is one of the most important financial periods in the process. Many buyers are surprised to learn that even after receiving a mortgage approval, changes to your finances can still impact your mortgage before closing.
As a mortgage broker, one of the most common conversations I have with clients is around protecting their approval until the keys are officially in hand.
If you’re buying a home in Alberta or anywhere in Canada, here are five major things to avoid before closing on your mortgage.
1. Avoid Taking on New Debt
This is one of the biggest mistakes home buyers make before possession day.
Financing a new vehicle, opening a line of credit, applying for store financing, or even purchasing furniture on a payment plan can affect your debt ratios and credit score. Lenders may re-check your credit before funding your mortgage, and new debt could change your qualification status.
Even small monthly payments can impact how much mortgage you qualify for.
Avoid:
- Vehicle loans or leases
- “Buy now, pay later” financing
- New credit cards
- Furniture or appliance financing
- Co-signing loans for someone else
If you’re unsure whether something could affect your mortgage approval, it’s always best to ask your mortgage broker first.
2. Don’t Change Jobs Without Talking to Your Mortgage Broker
A job change can create unexpected complications during the mortgage process, even if the new position pays more.
Lenders like stability. Switching employers, moving from salaried employment to commission-based income, or becoming self-employed right before closing may require the lender to reassess your application entirely.
This does not mean you can never change jobs during the process, but communication is critical.
Important factors lenders consider:
- Length of employment
- Type of income
- Probation periods
- Guaranteed hours
- Industry stability
Before making any employment decisions, speak with your mortgage broker so you understand how it could impact your mortgage approval.
3. Avoid Missing Payments
Your payment history matters throughout the mortgage process.
Late payments on credit cards, loans, or lines of credit can lower your credit score quickly and raise concerns for lenders. Even one missed payment can sometimes create unnecessary stress close to possession day.
During this time:
- Continue making all payments on time
- Avoid maxing out credit cards
- Keep balances manageable
- Maintain consistent banking habits
Protecting your credit profile right up until funding day is essential.
4. Don’t Move Money Around Without Documentation
Large deposits or unexplained transfers can create delays with your lender.
Mortgage lenders are required to verify the source of funds for down payments and closing costs. Moving money between multiple accounts or depositing cash without a clear paper trail can slow down the process.
Keep documentation for:
- Gifted down payments
- Savings transfers
- Investment withdrawals
- Property sale proceeds
- RRSP withdrawals
The cleaner and more organized your financial documents are, the smoother your closing process tends to be.
5. Avoid Making Large Purchases Before Possession Day
It can be tempting to start shopping for your new home early, especially for furniture, appliances, or renovations.
However, large purchases can impact your debt ratios, savings, and overall financial picture before your mortgage officially funds.
Many buyers want to furnish or renovate immediately, but waiting until after possession day can help avoid unnecessary complications.
Common purchases to postpone:
- Furniture
- Appliances
- Electronics
- Home renovations
- Large vacations or travel expenses
Your mortgage is not fully complete until funding has occurred and your lawyer has finalized the transaction.
Final Thoughts
Getting approved for a mortgage is a huge milestone, but protecting that approval is just as important. The weeks leading up to possession day are all about maintaining financial stability and avoiding surprises.
The good news is you do not have to navigate it alone.
Working with a mortgage broker means having someone in your corner to guide you through the entire process, answer questions, and help you avoid common mistakes before closing.
Frequently Asked Questions
Can a mortgage be denied after approval?
Yes. Mortgage approvals are often conditional until the final funding stage. Significant financial changes before closing can affect the lender’s final decision.
Should I use my credit card before closing?
Using your credit card responsibly is fine, but avoid increasing balances significantly or opening new accounts.
Can I buy furniture before possession day?
It is usually recommended to wait until after your mortgage funds and the home officially closes.
Why do lenders check credit again before funding?
Lenders may verify that your financial situation has remained stable since your original mortgage approval.
What should I do if my financial situation changes before closing?
Contact your mortgage broker immediately so they can help you navigate the situation proactively.
