Stay Financially Steady: Why Big Changes Can Be a Big Deal When Buying a Home

Buying a home is an exciting journey, but it’s also a financial balancing act. Once you’re in the process of purchasing a home, keeping your financial situation steady is crucial. Here’s why.

Lenders evaluate your financial health to determine how much house you can afford, and they’ll take another look right before closing. If anything changes—say, you switch jobs, take on new debt, or make a big purchase like a car—it could throw a wrench in your mortgage approval. In some cases, it might even cause your loan to be denied.

Here are a few things to keep in mind during this critical time:

1. Hold Off on Big Purchases: That shiny new car or furniture for your future home? It’s tempting, but wait until after closing. Large purchases can increase your debt-to-income ratio, which might affect your loan approval.
2. Don’t Open or Close Credit Accounts: A new credit card or loan can ding your credit score, while closing old accounts might impact your credit history. Both can create red flags for lenders.
3. Job Stability is Key: Thinking about changing jobs? If you can, wait until after the deal is done. Lenders like to see a steady employment history, and even switching to a higher-paying role could complicate things.
4. Stay Current on Bills: Missing a payment, even accidentally, can lower your credit score and raise concerns with lenders.

Think of it this way: buying a home is like running a marathon. Keeping your finances steady is the equivalent of maintaining a consistent pace—it gets you safely across the finish line. Once the deal is closed and the keys are in your hand, then you can start celebrating those life changes.

If you have questions or need guidance throughout the home-buying process, I’m here to help every step of the way!