The 7 Most Common Pre-Approval Mistakes (and How to Avoid Them)

Getting pre-approved is the first serious step in the homebuying journey—but it’s also where many buyers stumble. A pre-approval isn’t just a piece of paper; it’s a lender’s early green light based on your finances, credit, and employment. But if the details aren’t accurate or complete, it can derail your offer or even your loan down the road.

Here are the 7 most common pre-approval mistakes I see as a mortgage loan officer—and how to avoid them:

1. Ignoring Commute Distance to Work

Mistake: The borrower plans to buy a home over 100 miles from their current job without explaining how it’s feasible. Avoid it: If you're planning a long-distance move, be ready to explain how you’ll keep your current job—especially if remote work isn’t formally documented.

2. Not Sourcing Large Deposits

Mistake: Deposits over typical income amounts show up without clear documentation. Avoid it: Always be ready to source large deposits with a paper trail (gift letter, sale of an asset, etc.). Undocumented funds can cause delays or denial.

3. Leaving Out Side Income or Secondary Jobs

Mistake: Not disclosing all income sources, or counting income that hasn’t been consistent. Avoid it: Disclose everything up front. Lenders typically require a 2-year history of consistent part-time or self-employment income.

4. Co-Signed Debts Are Overlooked

Mistake: Borrowers assume co-signed loans don’t count against them. Avoid it: Co-signed debts do affect your DTI unless you can document 12 months of payments from the other party.

5. Credit Inquiries or New Debt After Pre-Approval

Mistake: Applying for new credit or taking on a new car loan after getting pre-approved. Avoid it: Don’t open new accounts, take out loans, or co-sign during the homebuying process. It can change your qualification status.

6. Occupancy Misunderstanding

Mistake: Saying you plan to live in the home but it's clearly too far from work, or already own a primary residence nearby. Avoid it: Be clear about whether the home is a primary, secondary, or investment property. Misrepresenting occupancy is a serious issue.

7. Freezing or Locking Credit

Mistake: Leaving a credit freeze on after applying. Avoid it: If you have a freeze, lift it temporarily so your lender can run the required checks.

Bonus: Use This Checklist During Pre-Approval

To make sure nothing gets missed, here’s a handy checklist of commonly overlooked details:

Employment & Income

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Assets

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Credit

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Property

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Other Considerations

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Need help getting pre-approved the right way? Let’s connect—I’m happy to walk through it with you step-by-step so there are no surprises when you find the perfect home.