Navigating Mortgage Loan Closures: Avoiding Common Pitfalls

Journey towards homeownership

In the journey towards homeownership, the final destination is often marked by the closing of your mortgage loan. This critical step involves meticulously arranging documents, funds, and agreements to ensure a seamless transition from buyer to homeowner. Buyers have many questions in mind, like ‘Can you pay closing costs with a credit card?’ or ‘Can you change jobs during the closing process?’ To help you avoid any unnecessary bumps on this road, here’s a list of common mistakes borrowers should avoid when closing their mortgage loans. By avoiding these errors, you can prevent delays and ensure a smoother progression through this significant transition.

Failing to Review Documents Thoroughly

Imagine a symphony with missing notes – documents at a mortgage loan closing play a similar role. Skipping the review of crucial paperwork, such as the Loan Estimate and Closing Disclosure, can lead to misunderstandings and surprises. These documents outline loan terms, interest rates, closing costs, etc. A thorough review ensures you’re well-informed and avoids unwelcome surprises.

Ignoring the Loan Estimate Changes

Change is the only constant, even in the financial realm. Failing to notice updates to the Loan Estimate, especially related to interest rates or loan terms, can lead to unexpected changes in your financial obligations. Regularly communicate with your lender to stay updated and prevent any last-minute shocks.

Overlooking Credit Score Management

Your credit score is pivotal in determining your loan eligibility and interest rates. Unfortunately, some borrowers mistakenly assume that the loan is sealed once approved. However, significant changes in your credit profile, such as taking on new debts, can affect your mortgage terms before the closing. Be cautious and avoid major financial moves until your mortgage is fully closed.

Underestimating Closing Costs

Closing costs can catch borrowers off guard if not anticipated correctly. Items such as appraisal fees, title insurance, and attorney fees contribute to these costs. It’s crucial to budget for these expenses and be financially prepared. Review the Closing Disclosure form to understand the exact breakdown of these costs before the closing day arrives.

Changing Employment or Income

Stability is paramount during the mortgage closing process. Changing jobs or professions or experiencing a significant fluctuation in income can create uncertainty for lenders. This could result in the loan terms being re-evaluated or, worst cases, the loan falling through. Make any significant career changes after your mortgage is securely closed.

Opening New Credit Accounts

While taking advantage of special offers or discounts might be tempting, opening new credit accounts before your mortgage closing can have adverse effects. This action can impact your credit score and raise concerns for lenders. Hold off on opening new credit accounts until after the closing to keep your financial profile stable.

Paying Closing Costs with a Credit Card

Certainly, the question “Can you pay closing costs with a credit card?” is a valid one. However, while using a credit card to cover closing costs may appear convenient, it’s an avenue that demands careful consideration. The possibility of fees and their potential influence on your credit utilization ratio might lead some lenders to decline credit card payments for substantial expenses like closing costs. Even if your lender does permit this approach, it’s important to note that utilizing a credit card could lead to elevated interest fees if the balance is not promptly settled.


As you approach the final steps of your mortgage loan journey, keeping a vigilant eye on potential pitfalls can save you from unnecessary stress and complications. You can ensure a smoother closing process by reviewing documents, staying in touch with your lender, and avoiding major financial changes. By meticulously tending to particulars and evading these prevalent errors, you’ll be aptly equipped to complete the necessary steps, transforming from a borrower into a homeowner with a triumphant and fulfilling transition.


Please enter your comment!
Please enter your name here