The housing prices are still low and mortgage rates are starting to creep up. It is time to buy a house!

First things first, you need to make sure you are in the position to buy a house. If you plan to buy a house in the next few months, you need to prepare a few things before you start looking and applying for a loan.

The following are 7 things that can hurt your credit score and may prevent you from being able to buy a house:

  1. No Credit – A while ago no credit was considered good credit. Now, however, a lender needs to see that a home buyer has history of managing credit obligations. If you are new to the credit arena, you may have trouble getting a mortgage to buy a house.
  2. You’ve Checked Your Credit Too Many Times – This can take points off your credit score. Hold off applying for anything for at least six months before applying for a mortgage to buy a house.
  3. No New Credit – Once you reach escrow, you will not want to apply for or obtain new credit. Fannie Mae is now requiring lenders to run a new credit report just before the loan funds. Wait until all is final to finance your furniture for your new home or apply for any credit cards.
  4. Reserves – Mortgage lenders want to make sure you have proper reserves such as a savings account, IRA, stocks, etc. Inadequate reserves can kill many loans.
  5. Credit To Debt Ratio – Your preferred credit to debt ratio will vary by lender. If it is higher than the amount, however, it is wise to pay your cards down or expect to be denied on your mortgage to buy a house.
  6. buy a houseJob History – If you haven’t been at your job long enough, this may hurt your chances of qualifying for a loan. If you just started a new job, we recommend you wait three to six months before putting in an offer to buy a house.
  7. Identity Theft Victim – If you have not checked your credit in a while and do so while applying for a mortgage loan, you may be upset to learn you have been a victim of identity theft. It is important to notify the policy, the credit bureaus and your creditors immediately if you have become a victim of identity theft.