I Can’t Use My Credit Cards?

I recently had a loan application that almost went astray when I found out that the client had used their credit cards to make some large purchases after loan application. They had just renovated their home and they had come to me to refinance their home, to do a cash out refinance to get some cash back for what they had spent on the renovations and they went out and purchased new pool furniture for the pool and new furniture for the inside of the house, new drapes. They made some major purchases and what happened was that most banks, when you submit the loan for final approval, will pull their own credit report on top of the ones that we pull at loan application. Well, there was another $25,000 in debt on the credit report and that hurt the borrower’s debt ratios and we had to scramble to make the loan work. So, another thing to focus on is don’t use your credit cards for major purchases after your loan application.