Thinking of buying your first home this year? Well, you better act fast. Mortgage rates are expected to climb, and housing prices will likely hit their highest peak by summer.

If you want a good deal (read: a monthly mortgage payment you can afford), then it’s time to get a move-on.

Now, that’s not to say you need to start looking at homes post-haste, but there are a few steps you need to take ASAP just to get the ball rolling. You see, getting pre-approved for a loan will be crucial once you start house-hunting. Not only will it give you an idea of what price range to look it, but it will also let sellers know you’re serious — not to mention qualified — to purchase their properties. It can give you a big leg up on the condition.

But in order to get pre-approved for a loan, you’ll need to start safeguarding your credit today — especially if you want to take advantage of those low mortgage rates before they start to skyrocket.

Not sure how to do that? It’s simple: Just say NO to these 5 things.

  1. Checking your credit. At the outset, you should definitely check your credit just to get an idea of what the big picture is. But don’t go overboard. In fact, too many credit inquiries to your name can send up serious red flags to your mortgage lender, signaling that you’re either trying to get new lines of credit often or loans, or you’re opening a lot of new accounts. Either way, you’re spending left and right, and that probably means you won’t be able to afford that mortgage payment you’re currently applying for.
  2. Making large purchases. A home is a big enough purchase as it is, so lenders are a little wary to issue a loan to someone who also just bought a car, a $10,000-dollar vacation, and a brand new motorcycle. They want to see that 1) you’re going to be able to handle all the bills and costs you have coming in, PLUS your new mortgage payment and 2) that you spend your money wisely and responsibly. Making large purchase right before the BIGGEST purchase of your life says that neither of these things is true.
  3. Putting a lot on your credit cards. The less you can put on your credit card the better — especially leading up to your mortgage application. Putting something on a card usually indicates you don’t have the cash available to cover it, and if you don’t have the cash available to cover your current costs, how are you ever going to have enough to cover an entire mortgage payment, plus all the utilities and other costs that come with a home? It will definitely make a lender think twice about giving you a loan.
  4. Missing payments. This is the biggest red flag to a lender because a missed payment says you simply live beyond your means. If you can, schedule an auto-payment for all your bills and loan payments, and make sure you’re never missing a date. These will show up in your credit report right off the bat, and if they don’t completely disqualify you from getting a loan, they’ll certainly up your rate — and by a significant amount. That means a higher monthly payment and thousands and thousands more spent over the course of your loan. Yikes!
  5. Opening new lines of credit. A mortgage loan is just about the biggest line of credit you can open, so don’t go compounding the issue by adding on an auto loan, a loan for new furniture or a new AmEx card right around the same time you seek pre-approval. If you really need those things, try to wait until after you’ve closed on your home and your mortgage has been issued. (Only if you can afford them, of course!) This will ensure it doesn’t impact your rate or your ability to buy a home.

It’s crucial that you tread carefully as you get closer to house-hunting. Securing a mortgage can be a difficult process, and just one financial slip-up can cost you a good rate (and an affordable monthly payment). It could even cost you and your family your dream home.

Want more helpful advice and guidance in the home buying process? Contact The Claus Team today. Our expert agents can walk you through every step of the way.