According to Sharon Burns, executive director of the Association for Financial Counseling and Planning Education, a couple should start preparing about six months before beginning their house hunt. Lending institutions will evaluate this report before approving your loan. If you see mistakes, you can correct them before applying for a mortgage. Close credit card accounts that are not in use. Pay down balances on other cards, or better yet, pay them off.
Lenders consider current debt load on credit cards.
They also consider total credit available. Gather two or three years of tax returns. You must have a consistent source of income and a stable work history. Also, be ready with down-payment information. If your down-payment money is a gift, you may need to ask the giftor to provide a letter explaining this.