Buying A Home November 2, 2022

10 Things Not To Do When Buying A Home


It can be fun to buy your first home. You’ll start building your life with your partner and family. There’s a lot at stake here, so be prepared for what lies ahead. Here are ten things not to do when buying a home.

Only Sign a contract after getting a pre-approval letter.

Before you sign any contract, make sure you have a pre-approval letter. A pre-approval letter is a document from one of the central banks in Canada that states how much mortgage money they are willing to lend you.

This amount will be based on your income, credit history, and other factors and will help you know what kind of house you can afford. Getting this letter before signing a contract is crucial because it will allow you to see if there are any discrepancies between what the seller says about the property and its actual value.

If there are significant differences between these two numbers (like $10 million), then your best bet might be walking away from any offer until both parties address those issues.

Don’t Overlook Your Credit Score

It’s a good idea to check your credit score before looking for a home. A good credit history shows you’re responsible with money and help qualify you for better mortgage rates and other types of loans. Check your FICO score (or another rating system) to see how well your FICO score reflects your financial habits. You can request a free copy from

Don’t Disregard Closing Costs When Estimating the Total Cost of Home Ownership

One of the 10 things not to do when buying a home is to overlook the closing costs, which can amount to as much as 5% of the purchase price.

However, many buyers need to consider closing costs when estimating how much they’ll pay for their new homes. Closing costs include title insurance, origination fees, and appraisal fees.

Remember: Closing costs are part of purchasing a home and will affect your total cost of ownership.

Remember the Hidden Costs of Home Ownership.

If you’re unaware of the hidden costs of homeownership, it can be easy to think that a home is free. After all, you pay a mortgage and taxes on your property each year—so why would there be anything else?

The truth is that buying a house comes with its expenses. In addition to paying for the mortgage, other expenses like maintenance and insurance must be considered when deciding whether or not this is right for you financially.

Avoid Making Large Purchases Before Getting a Mortgage

  • Avoid Making Large Purchases Before Getting a Mortgage

It’s tempting to splurge on furniture and appliances, but it can be detrimental to your mortgage application. For example, buying furniture that costs $5,000 while still renting an apartment will appear as an equity line of credit from your credit card and could increase your outstanding debt.

This, in turn, will negatively affect your debt-to-income ratio and make it harder for lenders to approve your application for a mortgage.

Avoid Changing Jobs While Applying for a Mortgage

  • Keep jobs the same while applying for a mortgage. If you’ve been unemployed or have a new job that doesn’t pay as well as your current one, be prepared to prove how much money you make.

If the lender feels you can’t afford the home they’ve approved and don’t think they’ll get their money back from selling it, they might ask for more from you upfront to get the loan approved in time.

  • Consider alternative options for getting approved for a mortgage.

For example, if you’re self-employed and have trouble proving income history or creditworthiness, consider getting an asset-based loan instead of going through traditional bank loans or credit unions (which usually carry higher interest rates).

Avoid Quitting Your Job While Applying for a Mortgage

  • While you may be tempted to quit your job once you find a house you love and can afford, doing so could scuttle your chances of getting approved for a mortgage. Most lenders require that you have been employed with your current employer for at least two years when applying for a mortgage.
  • The lender will be more convinced that you aren’t taking on too much risk by granting loans to people who don’t currently work full-time jobs if you live in an area with positions available and if you have proof of employment.
  • When considering not quitting work before closing on a new home, consider this: leaving one company without having another lined up can make applying harder (if they still think rehiring).

Avoid Not Paying Your Bills on Time

One of the 10 things not to do when buying a home is not paying your bills on time. Late payments will affect your credit score, making it difficult to get a mortgage or other financing options.

Lenders consider multiple late payments in the last six months significant and can cause severe problems with getting approved for loans. If you’ve been unemployed for an extended period and are having trouble paying your bills on time, consider asking for an extension from creditors rather than letting them pile up.

Avoid Co-Signing on Another Loan Before Getting Your Mortgage

  • Avoid co-signing on another loan before getting your mortgage.
  • Why you shouldn’t do it: You might be tempted to co-sign on loan for your spouse, relative, or friend to help them afford a home in your neighborhood. But doing so may expose you to financial risk and disqualify you for an FHA loan.

If they default on the loan, it could hurt both of your credit scores (because they’re attached), making it harder for either of you to get approved for future mortgages and other loans — not just those backed by FHA!

  • What To Do Instead: Wait until after closing before helping others find their first homes; they can rent while they save up enough money for a down payment.

Avoid Starting the Application Process at the Last Minute

One of the final 10 things not to do when buying a home is procrastinating the application process. You’ll need to gather your documents, including pay stubs, tax returns, and financial records, such as bank statements and credit card bills.

All these things need to be organized in an easily accessible manner so you can send them off quickly when it comes time for the lender (or broker) to request them.

If you wait until the last minute, they will need more time before closing day to go through everything with a fine-toothed comb, which could mean that they miss something important that could put the whole application at risk of rejection.

Many things could go wrong in the process of buying a house. It’s best to understand what to do, even more so than knowing what not to do.

Buyers should know what they are getting into before buying a house. Buyers must have a game plan and be prepared to buy a home.

Buyers must know what they will do if something goes wrong while buying a house.


You’re almost there! You should know all the right things to do now. It’s essential to understand what not to do when buying a home, but it’s even more important to take care of your finances and stay on top of your credit score.

If you don’t know where to start, ask a friend or family member for help—and don’t forget about all the hidden costs of owning property!