Purchasing a home is an exciting milestone, but even well-qualified buyers can encounter unexpected financing challenges if they make certain financial decisions after beginning the mortgage process. While lenders ultimately evaluate a borrower’s creditworthiness, real estate agents play an important role in helping clients understand how everyday financial choices can impact their ability to close on a home.
By educating buyers early and encouraging open communication with their lender, agents can help minimize surprises and keep transactions moving smoothly.
Why Credit Matters Throughout the Homebuying Process
Many buyers assume their credit only matters when they first apply for a mortgage. In reality, lenders may continue reviewing a borrower’s financial profile throughout the underwriting process, and some lenders perform a final credit check before closing. Changes to a buyer’s debt, credit utilization or employment could affect loan approval or require additional underwriting review. According to the Consumer Financial Protection Bureau, maintaining financial stability throughout the mortgage process is an important part of helping ensure a successful closing.
Helping buyers understand that their financial decisions continue to matter after preapproval can prevent unnecessary complications later in the transaction.
Mistake #1: Applying for New Credit
One of the most common mistakes buyers make is opening a new credit account while purchasing a home.
Whether it is financing furniture, refinancing an existing loan or change to additional debt, every new credit inquiry and account has the potential to affect a buyer’s credit profile. New debt may increase a borrower’s debt-to-income ratio, while a hard inquiry could temporarily lower their credit score.
If clients are eager to furnish their new home, remind them that waiting until after closing can help avoid unnecessary complications during underwriting. While unexpected expenses do arise, delaying major financial decisions until after the loan has been funded can help keep the mortgage process on track.
Mistake #2: Increasing Credit Card Balances
Credit utilization, or the amount of available credit a consumer is using, is one factor that influences credit scores. According to Experian, maintaining lower credit utilization can have a positive impact on credit health.
Large purchases made with existing credit cards can increase utilization quickly, even if buyers intend to pay the balance off later. Higher balances may affect both credit scores and debt-to-income calculations, particularly if they occur before closing.
Encouraging buyers to delay discretionary purchases can help preserve their financial profile during the loan process.
Mistake #3: Missing or Paying Bills Late
Even a single late payment can affect a buyer’s credit history.
Life becomes busy after an offer is accepted, especially when buyers are coordinating inspections, packing and preparing to move. However, forgetting to make minimum payments on existing accounts can create avoidable setbacks.
Agents can encourage clients to set up automatic payments or calendar reminders while their transaction is underway.
Mistake #4: Making Large Unexplained Deposits
Buyers are often surprised to learn that lenders may ask about large deposits appearing in their bank accounts.
Underwriters are responsible for verifying the source of funds used for a home purchase. Unexpected deposits without clear documentation may require additional explanation before the loan can move forward.
If buyers receive gift funds from family members or transfer money between accounts, encourage them to discuss those transactions with their loan officer beforehand so appropriate documentation can be prepared.
Mistake #5: Changing Jobs Without Talking to Their Lender
Career opportunities can arise at any time, but changing employers or compensation structures during the mortgage process may require additional documentation or underwriting review.
While changing jobs does not automatically disqualify a borrower, buyers should always notify their lender before making employment changes. Open communication helps everyone understand how the transition may affect the loan timeline.
How Agents Can Help Buyers Stay on Track
Real estate agents do not need to be mortgage experts to provide meaningful value during the financing process. Instead, they can reinforce a few simple best practices:
- Encourage buyers to consult their loan officer before making significant financial decisions.
- Recommend avoiding new debt until after closing.
- Remind buyers to continue making all payments on time.
- Set expectations that additional documentation requests are a normal part of underwriting.
- Maintain regular communication with the lender throughout the transaction.
These conversations can help buyers feel more prepared while reducing last-minute surprises.
Education Builds Stronger Transactions
Buying a home involves much more than finding the right property. It also requires financial consistency from contract to closing. By helping clients understand the credit habits that support a successful mortgage approval, agents can contribute to a smoother transaction and reinforce their role as a trusted advisor throughout the homebuying journey.
At Mutual of Omaha Mortgage, we understand that the homebuying process can be overwhelming, but we’re here to help. From understanding mortgages to finding the right loan, our loan officers work closely with both borrowers and real estate professionals to answer questions, explain financing requirements and address potential concerns before they become obstacles. When agents and lenders work together as partners, buyers are better positioned to move from accepted offer to closing day with confidence.
