I just read an article from The Associated Press by Dawn Wotapka on the subject of home buyers, credit reports and mortgage loans. There were two points of interest that I want to share, along with my opinion of course…

* Home buyers who are under contract and hoping to close before Nov. 30 (when the first-time home buyer credit expires) should refrain from buying furniture, appliances and other large ticket items on credit.

* Most lenders are running ADDITIONAL credit checks prior to closing day and any increase in credit card or other debt can jeopardize the loan!

When you are getting ready to move in to your new home, the urge to buy a new area rug, outdoor BBQ, flat screen TV and entertainment center is natural! But when lenders see large run-ups in credit card balances they will attempt to “re-qualify” you for the loan based on the new increased debt you have incurred. If you no longer qualify, well… get ready to return the area rug and stay in your current home.

So wait until you have CLOSED on your new home (and the new loan) before buying anything on credit. You don’t want to get a phone call 4 days before you are about to move saying that your loan is being “re-considered”, which usually means it will be denied.

Remember, the best way to not spend money is to stay out of the store!