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 Hello, and we are back to talk more real estate. Today I am gonna talk about dos and don'ts For buyers  that are getting ready to buy a house and you started the loan process, there's definitely dos and don'ts and I'm gonna try and help you not make mistakes so you can have a straight run to closing. 

 Hi, I'm Judith Barnett. Judith Barnett sells homes with my home group Realty, where real estate is done with compassion and integrity. Like I said, today we're gonna be talking about, sorry, I have a list which you can download of our dos and don'ts for the buyer who's in the process of, they've applied for the loan and they're going through the process of getting.

You know, all their ducks in a row to be able to get that wonderful, clear to close and close on their house in 30 days. However,  mistakes have been made along the way  by many people. Hence the reason we have a do's and don'ts list.  Some things are outside of your control. For instance, I was in the process many years ago of buying a house and I literally was laid off my job.

I didn't think it was a big deal 'cause I had like 16 weeks of severance pay and I knew I was gonna get a job in no time. You know, the industry I was in at the time, I could get a job pretty quickly and they called to confirm my employment. Literally, and this is important.

They will call at the last minute to confirm you are still employed, so don't think you can change jobs or quit and still get your loan. So they called, literally, I think it was just a couple of days. Before close of escrow to confirm my employment and I had been laid off and here I thought I was gonna have the summer off and hang out with the kids and have a great summer and no, I spent the summer living in my sister and brother-in-law's basement.

Looking for another house and getting a new job and all of that. It was a very stressful time to say the least.  So don't quit your job. This is a don't, don't quit your job. Don't change your job. You can take another job within the same company. You could take a promotion, but don't take a demotion. You can't get laid off.

Unemployment does not count. When it comes to having steady income, I'm sorry, it doesn't count. So that's just one another biggie that people do that just. Kills them is they will make a big purchase. Like they'll  go out and buy a new car or a new vehicle. They will like, oh, we're gonna need new appliances for the house.

So they'll go, oh, there's a sale at Home Depot. We better go and buy stuff. So we get the good deal. No, no, no, no, no, no. Do not do that.  Do not take out any kind of loan personal loan. Credit cards do not do anything that's going to potentially increase your debt and or hit your credit score. 'cause all of that is monitored from the moment you apply for a loan until literally you close on the loan.

You cannot do anything that's going to impact your debt to credit your debt to income or your credit score every time you do that. You could get shut down and your loan denied and you're gonna lose the house.  Don't even open a new cell phone account. Don't even add a new line to your cell phone account.

Don't go get a new iPad through Verizon. Don't do any of those things because they check it all the time, constantly checking it. Don't change bank accounts. Oh my lord Jesus. Please do not change bank accounts. Unless there's an extremely good reason to do it, and then make sure you talk to your lender before you do it on the best steps and process to make that happen.

Obviously, you can change your bank as soon as you close on the house, but in the meantime, hold steady, you know, set your sails hold steady on the goal, the destination, which is closing on your new house.  Don't take cash out from underneath your mattress or closet or safety deposit box or a gift from someone and put it in your bank because that's gonna be a red flag.

They're gonna look at that and we're talking thousands of dollars here. I've had clients who go, oh no, I have the down payment. I'm like, oh, that's great. Where is it? Come to find out they've been putting money aside. In cash and they've got thousands of dollars in a safety deposit box or under their mattress or wherever, and they're like, we're gonna use that.

We're gonna use that. And again,  call your lender because they're gonna tell you  how you can use that cash. It's not that you can't use it, but it will delay your closing. So don't do that. Please just keep your cash. Or if you have cash and you know you're buying a house, please deposit that money in the bank.

Like immediately. Immediately. Unless you're under contract,  don't pay charge offs. And if you don't know what that is, that's anything that's like a, that somebody, a creditor has charged it off, they're not gonna follow you to try and get the money back.

Do not pay those,  don't pay off credit cards.  Just do your normal payments unless your lender says, go ahead and pay off this credit card, or we're gonna pay off these credit cards at close of escrow. Okay? So there's some very specific ways you can do these things, but please talk to your lender before keywords, before you do any of them.

 Don't close any credit card accounts.  We think, oh, that'll be great. Don't close any credit card accounts. Don't open any credit cards accounts.  Don't consolidate your debt or your credit cards. Everything when you apply for your loan and you get approved and you can start looking for houses. That's sort of the line in the sand that the lender's working off

anything you change after that line in the sand. Probably is not gonna work in your best interest unless your lender tells you to do something. So always talk to your lender. I think that's mostly, again, don't pay off anything unless your lender tells you to. Okay? Sometimes that's necessary, but again, only as lenders advise what you can do.

Here's the good news. What you can do, do, do, do, do. Yes. These are the yeses. One, continue to pay your bills like you always have  on time, not late on time, and you can pay a little extra. But again, don't pay off a credit card. Don't pay off a loan unless you've had that conversation with your lender.

 Working with your current employer. You can  take promotions, not demotions, and you cannot quit your job and go get a new one. Don't do that. Stay with the same insurance companies,  homeowner's insurance, car insurance, renter's insurance. Do not change your insurance companies. And you're like, wow. They make a difference because insurance companies check your credit and that could impact your credit score, which is bad.

Again, the lenders are constantly checking these things. So if your credit score goes down, you started at, you know, 750, but you did a bunch of stuff and now you're at 580. Well that's a problem 'cause they keep looking. They don't stop looking. They're constantly checking this stuff.  Use your credit like you usually do.

So if you  use your credit cards to pay for your gas and your groceries and you pay it off in one payment at the end of the month, great. However you normally. Typically use your credit cards, do that. And again, just don't, basically don't change anything when it comes to how you spend money, where you spend your money, credit cards, bank accounts, you're just status quo, just ride smooth.

Okay. Nice and smooth. And people have made many mistakes. I had a client who did take out a loan. And that ended badly. We had to do a whole lot of, finagling and actually he had to pay off that loan that he took. And it had to be a gift. It couldn't be him paying it off. 'cause where was he gonna get the money just to get the loan?

I lost my job and I did lose the house and I had to wait until I had a new job and confirmation to go. Look for and put an offer in on another house. And so me and my kids are basically, you know, homeless for a while. Don't pay off credit cards. Just do your normal again unless your lender tells you to.

I know someone who sold a property to pay off a vehicle, loan, credit cards, everything. And what happened is his, I know this seems weird, but his  credit score took just tanked.  Just tanked and he couldn't refinance this house that he wanted to refinance. It's totally screwed him up. He was outta luck.

 And again, it can totally, it's all about debt to income. So here's how much money you have going out every month. Here's how much you have coming in, and there's only a small, there's only a percent between the two that lenders are willing to do, and any of that changes. Your credit score is constantly being monitored. 

So if your credit score takes a big dip because you did any of these things on the don't list,  they can decline your loan  even if you're under contract and you're like, but it used to be, and they're like, it doesn't matter. It doesn't matter. So just keep in mind, there's no mercy, no mercy. One underwriters don't care.

They don't care what your story is. They don't care about you. They just look at the numbers and they crunch numbers. And so that's why we're saying don't do these things. Do whatever you were doing when you applied for the loan and your lender says, you're good. You're blessed. Go for it. Let's go buy a house.

Keep doing that. If you have any questions, please post them below. Please like and subscribe. The do's and don'ts list will be below in a link. You can reach out and I'll get it sent to you. If you have any questions or feedback or wanna share your stories, good, bad, or ugly, we'd love to see them. Thank you.