A reader worries that her lender will think she lied after bad timing leads to a big charge.

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When I applied for my mortgage, I told the lender that my credit card balances were $0 because we pay off charges in full every month. Then literally two days after that transmission went out, I have to charge $1,100 to one of my cards because we’re using all our savings for the down payment on the home. Do I have to call the lender back and tell them about the balance?

Will they find out and think I lied, or does it not matter since it happened after I applied?
– Corinne in GA

Charles Puleri from CrossCountry Mortgage explains…

You don’t need to worry. It happens that a borrower’s circumstances may change after they report income and liabilities to a lender during a mortgage application. They won’t think you lied.

At most, the lender may contact you to confirm the information if they get notified that your credit report has been updated. Then they will calculate the new debt into your ratios to make sure that you still qualify for the loan.

How and when do lenders review the information a borrower provides?

A lender will always go off the credit report that was pulled when a borrower applied. Most lenders go by the information that is on a borrower’s tri-merge credit report. This report contains information from all three credit bureaus.

After a lender pulls a credit report, it is good for 120 days.

Once a borrower has a processed application, the lender will get alerted if there are any changes to the original credit report.

If there are new credit inquiries or balances added to a borrower’s credit report before closing, then the lender will get an alert. The loan processor may call you to confirm that you have a new account or updated balance. Then they will count the new debt into your ratios.


How will the new debt affect your debt ratios?

The only issue you may have is if the new balance tipped your debt ratios over the limit of what the lender will approve. Lenders want to see that you can afford your new mortgage payments, so they calculate things like debt-to-income ratio with the new loan payments factored in.

If you have too much debt relative to your income, then you would not get approved for the new loan. Lenders have different ratio requirements, so you will need to contact your lender to see if this new balance could affect your loan application. It will depend on how much other debt you have and how that debt compares to your total household income.

Making sure a lender has up-to-date information Lenders always go by what’s listed in a borrower’s credit report. However, in some cases, the information in a report may not be up to date. If a borrower is in a situation where an outdated balance or other information may negatively affect a loan application, then the borrower can send in documentation to the lender.

The lender can do a credit supplement with the credit company to get the report the most accurate it can be.

If you have more questions, call me toll-free at or email me at [email protected]

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About the Author

Charles Puleri

Charles Puleri

I am a residential mortgage expert with 21 years of vast experience structuring creative solutions ranging from high net worth clientele to repeat refi's and first time home buyers.

Published by Debt.com, LLC