Getting approved for a mortgage is a big milestone. But your loan is not final until closing day.

From approval to closing, your lender continues to monitor your financial situation. Even small changes can affect your loan qualification.

If you want a smooth closing process, keep your finances stable and avoid these common mistakes.

What Should You Avoid Doing After Mortgage Approval?

Homebuyers should avoid making financial changes that could affect their credit score, debt-to-income ratio, or employment stability.

Here is a simple checklist to follow until you receive the keys to your new home.

Homebuyer Checklist: What Not to Do Before Closing

Do not make large purchases
Large purchases such as furniture, appliances, or a car can create new debt. New debt increases your monthly obligations and changes your debt-to-income ratio. Higher ratios can make your loan riskier for lenders.

Do not move money between bank accounts
Lenders must verify and track your assets throughout the loan process. Sudden transfers or unexplained deposits can create delays during underwriting.

Do not deposit large amounts of cash
Mortgage lenders must be able to document the source of your funds. Cash deposits are difficult to trace and may require additional documentation.

Do not co-sign loans for anyone
Co-signing a loan makes you legally responsible for the payments. Lenders must count that obligation against you when reviewing your debt-to-income ratio.

Do not apply for new credit
Applying for credit cards, auto loans, or personal loans can lower your credit score. Your interest rate and loan approval depend on maintaining a stable credit profile.

Do not close credit accounts
Your credit score is affected by the length of your credit history and your total available credit. Closing accounts can negatively impact your score.

Do not change jobs without speaking with your lender
Employment stability is important during the mortgage process. If your employment situation changes, notify your lender right away so they can review how it may affect your loan.

Why Lenders Monitor Your Finances Until Closing

Mortgage lenders are responsible for making sure borrowers still qualify for their loan before the transaction closes.

This means they may recheck:

• Credit reports

• Employment status

• Bank statements

• Debt levels

Any major change could require additional approval or documentation.

The Key Rule for Homebuyers

The best strategy between mortgage approval and closing is simple.

Keep everything the same.

Avoid new debt.
Avoid financial surprises.
Avoid major life changes.

Once you receive the keys to your new home, you can celebrate and make those larger purchases with confidence.

With so much noise surrounding the housing market—headlines, opinions, and bold predictions—it’s easy to feel disoriented. The smartest move right now is to step back from the narratives and focus on the underlying trends that truly shape the market.

That’s exactly what the latest Orange County Housing Report, written by housing economist Steven Thomas (February 2, 2026), helps us do. And as we move past the holiday season and into the heart of the Winter Market, early 2026 trends are already starting to come into clearer focus.

A Familiar Start to the Year

Think back to the playground merry-go-round. It spins wildly, everyone hops off dizzy, and for a moment, it’s hard to walk straight. That’s what the housing market feels like at the start of each year—slightly disoriented after the distractions of the holidays.

By the end of January, though, the spinning slows. Direction becomes clearer. And this year is no exception. The first signs of 2026 are already revealing what lies ahead for supply, demand, and overall market speed in Orange County.

Here are the key early trends shaping the market right now.

1. New Listings: More Sellers—But Still Below Normal

Fewer homeowners are listing their homes than many expected. The main reason? Locked-in, low fixed-rate mortgages. Many owners are choosing to “hunker down” rather than give up favorable rates.

That said, this trend has been slowly easing since the historic lows of 2023:

• January 2023: 1,710 new listings (a record low)

• Pre-pandemic January average (2017–2019): 3,054 listings

• January 2024: 2,054 listings (+20% year over year, but still 33% below normal)

• January 2025: 2,545 listings (+24% from 2024)

• January 2026: 2,588 listings (+1.7% from last year, still 15% below pre-COVID norms)

While the number of new sellers has been increasing each year, the pace has slowed noticeably in 2026. The return to a “normal” level of seller participation remains gradual.

Market Signals: What January Is Telling Us

The supply of homes is driven by how many properties come to market, while inventory growth depends heavily on buyer demand. From 2023 through 2025, demand stayed relatively flat while new listings increased—causing inventory to grow steadily year over year.

As we head deeper into 2026, inventory growth will depend largely on whether buyer demand accelerates in today’s lower-rate environment. If it does, inventory may struggle to exceed last year’s levels.

2. Inventory: Growing, But More Moderately

Inventory is rising in 2026, but not at the explosive pace seen last year.

• 2023: Inventory dipped early in the year before slowly rising

• 2024: Inventory climbed steadily, peaking at 3,695 homes in September (+57% year over year)

• 2025: Inventory surged faster, peaking at 5,071 homes in July (+48% year over year)

• Current (2026): 3,179 homes on the market (+13% year over year)

This time last year, inventory was up 45% year over year. Today’s growth is far more measured. If improved mortgage rates spark stronger buyer activity, inventory growth could slow further—or even dip below last year’s levels.

3. Demand: Poised to Improve

Buyer demand in Orange County has been lagging compared to other Southern California markets, but conditions are shifting.

Mortgage rates have now been below 6.5% for five consecutive months, something we haven’t seen in years. In both 2024 and 2025, rates didn’t drop this low until the Fall Market. This year, lower rates are aligning with the Winter and Spring Markets—historically the strongest seasons for buyer activity.

To put affordability into perspective:

• A $1 million loan at 7% = $6,653 per month

• The same loan at 6% = $5,996 per month

• That’s a savings of $653 per month, or nearly $8,000 per year

This improved affordability could be the catalyst Orange County needs to see demand catch up with the rest of the region.

4. Market Speed: Improving Quickly

The speed of the market is accelerating fast.

The Expected Market Time—the number of days it would take to sell all current listings at today’s pace—has dropped dramatically:

• Two weeks ago: 101 days

• Today: 75 days

• Improvement: 26 days faster in just two weeks

That’s the largest two-week January drop since 2019.

For context:

• 2025: 63 days

• 2024: 45 days

While competition still feels less intense than in past years, momentum is clearly building. If demand strengthens further, market time could drop below last year’s levels—shifting negotiation power back toward sellers.

What This Means for 2026

Now that the merry-go-round has come to a stop, the direction of the 2026 Orange County housing market is becoming clearer. Early indicators point toward a strengthening market, supported by improving affordability, faster market speed, and steady—though still limited—seller participation.

As we move through the Winter Market and into Spring, these trends will play a critical role in shaping opportunities for both buyers and sellers.

If you’d like to talk about what these trends mean for your specific situation, I’m always happy to help.