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Expenses that could affect your mortgage

Updated 22 December 2022

2min read

Nick Green
Financial Journalist

You’re almost about to buy your dream home, don’t fall at the last hurdle. Dave Smith explains more.


As a homeowner gets closer to closing day, the excitement can be unbearable. You’ve spent a lot of time, research and money on your perfect home, and now your dreams are about to be realised.  Don’t make the mistake of thinking that just because the loan is approved that you can be lax about your spending habits.  In fact, mortgage lenders now check bank and savings accounts several times throughout the home buying process.  Credit is also checked again before closing.  Here are some purchases or expenses that could affect you getting your mortgage.

New vehicle purchase

It’s tempting to buy a brand new car to go along with the new house, but don’t make that mistake.  A new vehicle is an expensive purchase, usually second only to a home purchase. This can be a giant red flag to a lender when you’re ready to close.  It’s recommended that you wait a while after you purchase your home before making other large buys.  Give yourself six months to a year with the mortgage to make sure you can manage your expenses as they are.  If you have plenty of breathing room, then you can get that new car.

New line of credit

Are you thinking of taking out a line of credit to buy furniture or appliances? You’ll need to wait until after you’ve signed your mortgage papers to do so.  Any new line of credit can suggest to a lender that you’re in a financial crunch or that you don’t manage your money well.  Neither of those are impressions that you want to give to a lender.  Perhaps the only additional payment that you should even consider picking up during this time is a life insurance policy.  That would not carry any penalty against your mortgage because it’s a fiscally responsible decision.

Hold off on pimping out your pad

Any purchase or expense that drains your savings accounts or requires a new line of credit is off limits when you’re ready to close on a mortgage.  You don’t want to arrive at the closing table only to be told that they’ve decided not to give you the loan after all.  You should give yourself some time to acclimate to a mortgage before adding more monthly bills to your plate.  If you absolutely must make a purchase for your home, do it after you’ve signed all of the loan documents.

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About the author
Nick Green is a financial journalist writing for Unbiased.co.uk, the site that has helped over 10 million people find financial, business and legal advice. Nick has been writing professionally on money and business topics for over 15 years, and has previously written for leading accountancy firms PKF and BDO.