Course 5

The Worst Thing You Can Do Before Buying a Home

You've been saving your down payment. You found the neighborhood you love. And then you make one financial move that quietly kills your mortgage application. It happens more than you'd think.

The period right before and during the mortgage process is one of the most financially sensitive times in your life. Lenders don't just check your credit once — they often run a second check right before closing. That means any changes to your credit profile during the application process can affect your approval, your interest rate or even the entire deal.

Here are the most common mistakes that derail home purchases at the last minute:

Opening a new credit card or loan. Any new account creates a hard inquiry and adds new debt to your profile — both of which can lower your score and raise red flags for lenders.

Making a large purchase on credit. Buying furniture, appliances or a car during the mortgage process increases your debt-to-income ratio, which directly affects how much house you qualify for.

Changing jobs. Lenders want to see stable, verifiable income. Switching employers — even for a higher salary — can complicate or delay your approval.

Making large undocumented cash deposits. Every deposit in your bank account during the mortgage process must be explainable. Unexplained deposits can trigger additional scrutiny or requests for documentation.

Missing a payment. One 30-day late payment during the process can drop your score significantly and may result in a higher interest rate or denial.

Co-signing for someone else's loan. Even if you don't plan to use the loan, co-signing makes you legally responsible for that debt — and it shows up on your credit profile.

The best approach is to keep your financial life as stable as possible from the moment you decide to buy a home until the day you close. No major purchases, no new accounts, no job changes — just consistency.

If you're planning to buy a home in the next 6 to 12 months, talk to our team first. We can help you prepare your credit profile and avoid the mistakes that cost buyers their dream home.