While less credit card debt is ideal, a zero balance isn’t necessary to get approved for a mortgage. However, avoiding new debt and paying down the debt you currently have can boost your chances of approval. Mortgage lenders perform a credit check before the closing and notice any new debts acquired as well as the current balances.

The lender uses a debt-to-income ratio in combination with your credit scores to determine approval for the mortgage. Keeping your debt-to-income ratio at 36% or lower of your gross monthly income sets you up for success. So before you buy that new car, wait a few days after the loan has closed before signing on for any new debt.