6 mistakes to avoid in the 90 days before your mortgage preauthorization

The 90 days before your mortgage preauthorization request are probably the most sensitive period of your buying journey. A decision that looks harmless — switching jobs, opening a new card, moving $10,000 between accounts — can sink a file that would have been accepted without discussion.

Here are the 6 mistakes that come up every week at Quebec mortgage brokers, with the technical reasons behind them and how to avoid them.

Why 90 days?

Lenders look at your file on three axes that are assessed on this window:

• Credit score: recent changes (new inquiries, new accounts, balance increases) weigh more heavily than older history.
• GDS/TDS ratios: based on your current debts and minimum payments — not what they were 6 months ago.
• Traceability of the down payment: 90 days of bank statements are requested systematically.

A mistake made in this window is visible. A mistake made 6 months earlier is generally absorbed.

Mistake #1 — Taking on new debt (auto, furniture, personal loan)

This is by far the #1 cause of inflated or refused preauthorizations.

What happens technically

A $550 monthly payment on an auto loan represents roughly $100,000 less borrowing capacity. The calculation is mechanical: the lender adds the monthly payment to the gross debt service ratio. If you were at the 44% cap before, you''re now above it — refusal or a reduction in the amount.

Concrete example

Amélie, 34, income $78,000. Preauthorization capacity in February: $385,000. She finances a vehicle at $32,000 in March (payment $512/month). Result in April: capacity drops to $282,000. A condo she was targeting at $360,000 becomes out of budget.

What to do instead

If you absolutely need a vehicle, do it after signing at the notary. If a current vehicle is showing signs of failing, plan to keep driving it for the 4-6 months of the buying journey.

Mistake #2 — Changing jobs or going self-employed

Lenders value employment stability. A change in the 90 days before preauthorization creates three problems.

The technical problems

1. Probation period: in a new position, most lenders exclude the income until probation is complete (often 3-6 months).
2. Break in tenure: an 8-year employee with the same employer inspires more trust than a 2-month employee.
3. Switch to self-employment: eligible income shifts to the 2-year average of T2125 declared to the CRA — you lose several months of qualification until you have 2 complete tax years.

The exceptions that pass

• Internal promotion within the same company with a raise: generally accepted, with an HR letter confirming the new position.
• Change within the same field with clear continuity and no probation (rare but negotiable with some lenders).
• Move from contract to permanent with the same employer: accepted.

The right timing

If you know you''re going to change jobs and buy, two options: either you complete the purchase before changing (preauthorization, offer, notary — then you change), or you change first and wait until you''ve passed probation before starting the preauthorization. Never do both in parallel.

Mistake #3 — Missing or delaying a payment

A single payment more than 30 days late in the 90 days before preauthorization can drop your score by 60 to 100 points depending on your starting profile. On a credit card, student loan, auto loan, or phone bill that goes to collections — the mechanic is the same.

What that concretely changes

• Score going from 720 to 640 → you potentially shift from "A lender" to "B lender," with higher rates and stricter terms.
• Score under 680 → some A lenders refuse automatically.

What to check

• Automatic payments activated on all cards and loans.
• Contact information up to date with each creditor (a bill going to an old address and ending up in collections happens more than you''d think).
• Sufficient balance in the debit account — an NSF rejection on a debit counts as a default.

Check your credit score for free on Equifax or TransUnion before starting, to spot anomalies.

Mistake #4 — Using your credit cards heavily

The credit utilization ratio (balance / limit) is the second factor in the credit score after payment history. A card at $4,500 balance on a $5,000 limit (90% utilization) hurts the score more than a card at $500 on $5,000 (10%).

The rule of thumb

• Below 30% utilization per card: positive or neutral impact.
• Between 30% and 60%: moderate negative impact.
• Above 60%: strong negative impact, rapid score drop.

What to do in the 90 days

1. Bring each card''s balance below 30% of the limit before the monthly statement cut-off date (that''s the date reported to the credit bureaus, not the due date).
2. Don''t close old cards, even if you don''t use them — credit age counts, and closing a card reduces your total available limit (which inflates the overall utilization ratio).
3. Don''t apply for new cards — each application generates a credit inquiry that drops the score by 3-5 points, and adds a recent credit line that lowers the average age of accounts.

Mistake #5 — Making unexplained deposits in your bank accounts

The down payment must be traceable over a minimum of 90 days. Any significant deposit that appears on your statements without explanation will be questioned, and will block the submission until the source is documented.

The deposits that cause problems

• Cash deposited without justification (particularly scrutinized — suspicion of laundering or undeclared income).
• Interac transfer from an unidentified third party.
• Crypto transfer converted to dollars without clear history.
• Repayment from a friend without documentation.
• Sale of assets (car, jewelry) without an invoice or proof of purchase/sale.

The acceptable deposits (with documentation)

• Bonus / commission from the employer: reflected in the pay stub and T4.
• Tax refund: matching CRA Notice of Assessment.
• Family gift: signed gift letter + proof of the donor''s ability (see our documents checklist).
• HBP / FHSA withdrawal: statement from the plan.
• Sale of property: deed of sale.

The strategy

Consolidate your down payment in one main account, at least 90 days before the preauthorization. Avoid unnecessary transfers between accounts just before — they create noise in the statements and trigger questions.

Mistake #6 — Cosigning a loan for a family member or friend

Cosigning your brother''s auto loan, your child''s student line of credit, a separated spouse''s credit card — these commitments show up on your credit file the same way as if it were your own debt.

What the lender sees

• The total balance of the cosigned loan is counted in your debts.
• The monthly payment is added to your TDS ratio.
• If the primary debtor misses a payment, it drops your score as much as theirs.

The concrete impact

Cosigning a $45,000 student loan with a $380/month payment costs you roughly $70,000 in borrowing capacity. Some lenders agree to "release" a cosigner if the primary debtor can demonstrate they''ve been carrying the loan alone for 12+ months — that''s a process to start well before the critical 90 days.

The exit

If you''re a cosigner on a loan and you''re planning to buy:

1. Contact the lender of the cosigned loan to ask about the release procedure.
2. Gather proof that the primary debtor has been paying alone for 12 months.
3. Plan for several weeks for the procedure — not something to do at the last minute.

Otherwise, your broker will need to structure the preauthorization with this loan included in your ratios.

Recap — the 90-day checklist

What you should do during these 90 days

Flipping the mistakes around, here are the moves that help:

• Do a prequalification with the /en/prequal calculator to frame the budget.
• Gather documents in PDF (see full checklist).
• Pay off a well-targeted debt — paying down a high-rate card improves the score and frees up TDS ratio.
• Consolidate the down payment into one account, at least 90 days before submission.
• Contact an AMF-licensed broker for an initial qualification.

What Courteo does in this journey

Courteo is a matchmaking platform, not a broker. We connect you with a mortgage broker holding an AMF licence in the Courteo network, who analyzes your file and handles submission to the lenders. The /en/prequal calculator is a free tool to frame your budget upfront — no credit inquiry, no account to create.

Frequently asked questions on mistakes to avoid before preauthorization

Is it really a problem if I switch credit cards in the 90 days?

Yes. A new card generates a credit inquiry (score drops by 3-5 points), lowers the average age of your accounts, and adds a recent credit line. On a borderline file, it can tip the balance. Wait until after signing at the notary for any card change.

If I''ve already made one of the mistakes, is everything lost?

No. Most mistakes can be recovered in 3-6 months — paying off the new debt, returning to low card balances, stabilizing the file. A broker can assess the real impact and propose a correction plan. They can also identify lenders more tolerant depending on the type of mistake.

Will the lender really see my $3,000 unexplained deposit?

Yes. Underwriting combs through bank statements line by line for any deposit over ~$1,000. An unexplained deposit triggers a request for justification. Without justification, the corresponding down payment isn''t accepted — you then have to compensate with other traced funds.

Does paying off a debt just before the preauthorization actually help?

Yes, on both axes: ratios (the monthly payment disappears, TDS drops) and score (bringing a card down from 90% to 20% utilization can add 30-50 points in one billing cycle). Target the debt with the highest monthly payment per dollar of remaining balance.

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