7 Things You Should NEVER Do While House Hunting

Your Insider’s Guide to Smart Home Buying: Week 2

So, you’re ready to buy a home.

Exciting, right?

You’ve gotten serious about your budget, started thinking about neighborhoods, and maybe you’ve already found yourself scrolling through listings at 2 AM saying, “Wait…this one has a screened porch!”

I get it.

But before you get too deep into house hunting, we need to talk about something that isn’t nearly as exciting as touring homes, but could be much more important:

What you do with your finances while you’re buying one.

Getting pre-approved doesn’t mean your financing is permanently locked in. Your lender may continue verifying aspects of your finances throughout the process and again before closing.

That means a seemingly innocent decision, financing furniture, opening a credit card, moving a large amount of money, or even changing jobs, can create questions or documentation requirements at exactly the wrong time.

So from pre-approval until closing, there’s one rule I want you to remember:

Before making a significant financial change, talk to your lender.

And especially be careful with these seven things.

1. Don’t Change Jobs Without Talking to Your Lender

Have an amazing new opportunity come along?

Congratulations, but call your lender before making the move.

A job change doesn’t automatically mean you can’t qualify for a mortgage. The impact depends on several factors, including how you’re paid, whether you’re changing industries or employment types, the timing of the change, and the loan program you’re using.

For example, moving from a salaried W-2 position into self-employment can be very different from accepting another salaried position within the same field.

Even when the change is perfectly acceptable, your lender may need updated documentation before you close.

The point isn’t that you’re trapped in your job until closing.

It’s that your lender needs to know what’s happening.

Insider Tip: If you’re considering a job change, promotion, leave of absence, or change in how you’re compensated, talk to your loan officer before making the change.

2. Don’t Pay Off Debt Without Asking First

This one catches buyers by surprise.

You’re about to apply for a mortgage, so paying off every credit card and loan you possibly can sounds responsible.

Sometimes it may help.

Sometimes it may not be the best use of your available cash.

Your lender is looking at your entire financial picture—including your debt obligations, available funds, cash needed for closing, and any applicable reserve requirements.

Using a large portion of your savings to eliminate debt could leave you short on funds you need elsewhere in the transaction.

That’s why you shouldn’t guess.

If paying off or paying down a particular account would improve your mortgage qualification, your lender can help you determine how much to pay and when.

Insider Tip: Don’t make major debt-payoff decisions based solely on what you think will help your loan. Ask your lender to run the numbers first.

3. Don’t Make Major Purchases

I know.

You’ve found the house, mentally decorated the living room, and suddenly that new sectional you’ve been eyeing feels very necessary.

It can wait.

So can the new car.

And the bedroom set.

And the “12 months same as cash” furniture offer.

Taking on new debt before closing can affect your debt-to-income ratio or credit profile and potentially change the loan you originally qualified for.

Even if you can comfortably afford the payment, your lender still has to evaluate it under mortgage guidelines.

This is especially important after you’ve gone under contract.

Insider Tip: Don’t finance anything significant until you’ve closed on the home. When in doubt, call your lender before opening your wallet—or a new credit account.

4. Don’t Miss Payments

This is not the time to get casual about due dates.

Continue paying your existing obligations on time throughout the home-buying process.

That includes things like:

• Credit cards
• Auto loans
• Student loans
• Personal loans
• Your current mortgage or rent obligations, when applicable

A late payment can affect your credit profile, and changes to your credit during the mortgage process can create complications.

And here’s something worth remembering:

Don’t stop paying an account simply because you expect it to be paid off at closing.

Continue following your lender’s instructions until you’re told otherwise.

Set reminders. Use autopay where appropriate. Keep everything as consistent as possible.

5. Don’t Make Large or Unusual Deposits Without Documentation

Your lender needs to understand where the money you’re using to purchase the home came from.

So if a large, unusual deposit suddenly appears in your account, expect questions.

That doesn’t mean legitimate deposits aren’t allowed.

A bonus from work, proceeds from selling an asset, a documented gift, or money transferred from another account may be perfectly acceptable depending on your loan and circumstances.

But your lender may need documentation showing the source of those funds.

One thing that can be particularly difficult to document is cash.

If you’ve been saving money outside of the banking system, don’t simply deposit a large amount into your account right before applying for a mortgage and assume it’ll be treated like your regular savings.

Talk to your lender first.

Insider Tip: During the mortgage process, documentation is your friend. Before making an unusual deposit, ask how your lender wants it handled.

6. Don’t Co-Sign for Someone Else

Your sister needs a car.

Your child needs help qualifying for an apartment.

Your best friend promises, “You don’t have to pay anything. I just need your name.”

This may not be the best time.

When you co-sign a loan, you’re taking legal responsibility for that debt, even if someone else intends to make the payments.

That obligation may affect your mortgage qualification, and if the other borrower misses payments, it can potentially affect your credit as well.

If you’re planning to purchase a home, talk to your lender before agreeing to co-sign anything.

You can be the hero at the housewarming party instead.

7. Don’t Move Money Around Without a Plan

Transferring money between your own accounts isn’t inherently bad.

The problem is creating a complicated paper trail when your lender is trying to verify your assets.

Imagine moving $15,000 from savings to checking, then another portion into an investment account, then transferring it back when you need your earnest money or closing funds.

Now your lender may need documentation showing where the money originated and where it went.

You haven’t necessarily done anything wrong.

You’ve just made the documentation more complicated.

During the mortgage process, simple is usually better.

Before moving large amounts of money, liquidating investments, transferring funds between accounts, or changing where you’re keeping your closing funds, check with your lender.

The Real Rule: Keep Your Financial Life Boring

If you remember nothing else from this article, remember this:

From pre-approval through closing, boring finances are beautiful.

Keep earning.

Keep saving.

Keep paying your bills.

Keep your credit stable.

And before you make a significant financial move, ask your lender.

You don’t have to put your entire life on hold while buying a home. You just want to avoid creating unnecessary surprises during your mortgage approval.

Because the worst time to discover that a financial decision affected your loan is a few days before you’re supposed to get the keys.

Your Agent and Lender Should Be Working Together

This is also why having the right team matters.

Your real estate agent and lender have different roles, but we should be communicating throughout your transaction.

As your agent, I’m helping you evaluate properties, structure your offer, negotiate terms, manage deadlines, and navigate the transaction.

Your lender is the expert on your financing.

So when you ask me, “Can I buy a car right now?” you already know what I’m going to say:

Let’s call your lender.

That’s not passing you off. That’s making sure the person who knows your specific loan file gives you the answer.

The Bottom Line

Buying a home doesn’t require you to become a mortgage expert.

It does require you to protect the financial position that got you approved in the first place.

For the relatively short period between pre-approval and closing, think carefully before changing jobs, opening credit, taking on debt, moving large amounts of money, making unusual deposits, co-signing, or changing the way you manage your finances.

And when you’re unsure?

Ask before you act.

One quick conversation with your lender can be much easier than trying to fix an issue later.

Next in Your Insider’s Guide

Red Flags to Avoid When Buying a Home

No home is perfect, but some problems deserve a much closer look.

Next, we’ll talk about the warning signs you should pay attention to while touring homes, what deserves further investigation, and how to distinguish a manageable issue from something that could become a much bigger problem.

Ready to Start Your Home Search?

You don’t have to figure out the buying process on your own.

If you’re thinking about buying a home, let’s start with a conversation about your goals, timeline, and what you want your next move to look like. From there, I can help you build your buying strategy and connect you with a trusted lender so you understand your financing options before the serious house hunting begins.

Small & Co. Realty Group
Small enough to know your story. Experienced enough to guide you through it with confidence.