Top Things Buyers Should Avoid During the Contract Period to Secure Their Loan

Once your offer is accepted, it can feel like the hard part is over—but for buyers using financing, the contract period is actually one of the most sensitive phases of the transaction.

Even well-intentioned decisions can cause serious problems with loan approval, delays, or even denial. The goal during this time is simple: keep your financial picture as stable as possible until after closing.

Here are the most important things buyers should avoid during the contract period to help ensure a smooth path to the closing table.

1. Opening New Credit Cards or Lines of Credit

This is one of the most common—and costly—mistakes buyers make.

Opening new credit accounts can:

Lower your credit score due to hard inquiries
Increase your debt-to-income (DTI) ratio
Trigger additional lender documentation or re-approval

Even store cards, “no interest” financing, or credit offers tied to furniture and appliances can cause issues. If it requires a credit check, it’s best to wait.

2. Making Large Purchases

Big purchases can dramatically change how your loan looks on paper.

Avoid:

Buying cars, motorcycles, boats, or RVs
Financing furniture or appliances
Putting large charges on existing credit cards

Even if you plan to pay cash, lenders may still question the withdrawal of funds or require sourcing documentation. Always talk to your lender before spending large sums.

3. Switching Jobs or Changing Employment Status

Employment stability is critical to loan approval.

Red flags include:

Changing employers during the contract period
Switching from salaried to commission-based or self-employed work
Reducing hours or moving from full-time to part-time

Even a raise or “better opportunity” can delay or derail a loan if it changes how income is calculated.

4. Depositing Large or Unverifiable Cash Amounts

Lenders must verify where your funds come from to comply with lending regulations.

Avoid:

Cash deposits without documentation
Transfers between accounts without clear paper trails
Gifts that are not properly documented

If family is helping, your lender will need a gift letter and proof of transfer—never assume it’s okay without asking first.

5. Closing or Paying Off Accounts Without Guidance

It may seem smart to close unused accounts or pay off loans, but this can backfire.

Potential consequences:

Reduced credit history length
Credit score fluctuations
Changes to DTI calculations

Always consult your lender before making changes to existing accounts—even if your intention is to improve your profile.

6. Missing or Late Payments

This one is simple but critical: do not miss any payments.

Late payments on:

Credit cards
Student loans
Auto loans
Personal loans

can immediately impact your credit score and raise red flags during final loan review.

7. Applying for New Loans or Financing of Any Kind

Personal loans, buy-now-pay-later programs, and deferred payment plans all count as new debt.

Even if payments don’t start right away, lenders still factor these obligations into your loan approval.

8. Making Major Lifestyle Changes

Life happens—but big financial shifts can complicate underwriting.

Examples include:

Taking extended unpaid leave
Starting a new business
Co-signing a loan for someone else

If it affects income, assets, or liabilities, it needs lender approval first.

9. Ignoring Lender Requests or Delaying Documentation

Time matters during the contract period.

Delays in providing:

Bank statements
Pay stubs
Explanations of deposits or credit events

can push closing dates or jeopardize contract timelines. Quick responses keep everything moving smoothly.

10. Assuming “It’s Fine” Without Asking

The most important rule of all: never assume.

If you’re unsure whether something could affect your loan, ask your lender or Realtor first. A quick question can prevent major setbacks.

Final Thoughts

The contract period isn’t the time to optimize your finances—it’s the time to preserve stability. By keeping your credit, income, and assets consistent, you give your lender exactly what they need to get you to the closing table without surprises.

A strong team—lender and Realtor working together—helps guide you through this phase and protect your purchase from avoidable issues.