Mortgage Mistake 3 – New Lines of Credit.
When you are about to purchase a new home, you think about the wonderful, brand new shiny appliances you'll get. The furniture that will reflect your personality, the art, the accessories. Mortgage Mistake 3. Don't!
There are multiple reasons for not opening new lines of credit during or just before, you apply for your mortgage.
Your lender will carefully determine your income-to-debt ration to see if you qualify for the mortgage amount you have requested. Just before your new mortgage funds and you become the owner of a beautiful new home, the lender will look at your updated credit. If they see a new line of credit of any kind or even an inquiry from a credit company, the ratios will have to be examined again. When the new credit puts you over that all-important ratio, your loan may be rejected, even at the very last minute.
If you apply for credit then don't take the offered card, the lender will still be uneasy knowing you now have the ability to run up more monthly payments, even if they don't know how much.
It makes sense if you have little available credit on the cards you already own. You won't understand why this is so, however, if you already have cards with plenty of available credit. Lenders won't differentiate between those with available credit and those without. They never, ever like to see new available credit lines.
This is from my own personal experience and instant-gratification personality. You'll have moving expenses, utility installation expenses, other expenses that you may need to incur immediately upon move-in. Don't buy non-essentials until you know what you can easily afford. Better to put your money into the house itself – it's an asset. The “stuff” inside, not so much.