Homebuying Guide
Buying your first home is a significant investment. We’re here to make the process as easy as possible and keep you informed every step of the way. Whether you’re a first-time homebuyer, are buying a luxury home, or are investing in properties to build your real estate portfolio, we can help you get that new set of keys!
Steps For Buying A Home
Congratulations! You’ve decided to buy a home. Before beginning the loan process, it’s essential to do your research. There are many steps involved to make sure you have a smooth and successful experience. Start by getting pre-qualified. Simply fill out the pre-qualification form online and a licensed loan officer will contact you within 24 hours.
Pre-Qualify
What is pre-qualification?
Pre-qualification determines your ability to repay a loan based on the information you provide. Your liability, asset, and income information are reviewed by a licensed mortgage loan originator to establish the maximum purchase price you can afford and how much you may be able to borrow.
What are the benefits of pre-qualifying today?
Pre-qualification may establish you as a serious buyer when looking at real estate, give you an advantage over other buyers looking at the same property, and let you know what you can afford before home shopping.
Understanding Your Credit Report
Your credit score is not the only factor in getting approved for a mortgage, but it is an important part of determining what you will be able to qualify for.
Check your own credit score before meeting with a lender.
It’s important to make sure that your score is accurate when applying for a loan. You can get a free credit report once a year online by visiting annualcreditreport.com.
Verify the report for accurate information.
Report and dispute inaccuracies with the credit bureau. Disputes in the process may delay loan approval.
Paying down high credit balances may positively affect your credit score.
By paying down applicable lines of credit before applying for a loan, you may qualify and get approved for a better interest rate.
Set up payment plans.
Call your creditors and work out a budget-friendly payment plan on delinquent accounts prior to applying for a loan. Work out a plan that won’t harshly affect your debt-to-income ratio but will still let lenders know you are serious about being credible for your debts.
Get Pre-Approved
Pre-Qualification
It determines your ability to repay a loan based on the information you provide. Your liability, asset, and income information are reviewed by a licensed mortgage loan originator to establish the maximum purchase price you can afford and how much you may be able to borrow.
Pre-Approval
This is a written commitment from a lender to extend a mortgage to you for a specific amount and time period.
It is important to understand the difference between pre-qualification and pre-approval. A Pre-qualification determines your ability to repay a loan based on information you provide. Your liability, asset and income information are reviewed by a licensed mortgage loan originator to establish the maximum purchase price you can afford and how much you may be able to borrow. A Pre-approval is when your information is reviewed and verified by an underwriter. This involves an analysis of your financial status and credit history. With a pre-approval, you’ll be able to negotiate your home purchase confidently. Realtors and sellers will often take your offer more seriously if you get pre-approved prior to house shopping because it lets them know you are ready to make a deal. A pre-approval may help streamline your process and result in a smoother transaction.
Find The Right Realtor
Now that you have initiated the pre-approval process, and have an idea of how much you are comfortable spending, a realtor can help you through the home buying process. Finding the right realtor is just as important as finding the right lender. Make sure that you work with a real estate agent you can trust, has a proven track record, and has your best interests at heart. It’s useful to get referrals from family and friends who’ve been through the home buying process.
Avoid Dual Agents.
It is also commonly advised to avoid dual agents when going through the home buying process. A dual agent is a real estate agent who represents both the buyer and seller in a transaction. This is often a conflict of interest since it’s possible that the agent will not negotiate in the buyer’s interest in order to increase the commission. If you do use a dual agent, make sure it’s someone you trust completely.
Interview several agents before choosing one.
You may consider asking them a set of similar questions:
How long have you worked in real estate?
Is this your full-time job?
Have you sold homes in the area I am interested in before?
How many sales in this area have you done?
How many sales have you done in the last year?
Will you be present for the closing of my loan?
Start House Hunting
You have a lender and you have a realtor. Your next step will be to start looking at houses. It is easy to get carried away with the excitement of becoming a homeowner at this point. You may only be thinking about yard space, decorations and the amount of bedrooms you want, but it is important to consider all aspects of the property before moving forward.
Location is key!
Consider the crime rate, public school ratings, your daily commute, traffic patterns, and local amenities when choosing a home. If public parks, libraries, pools, sporting arenas, churches, restaurants or shopping centers are important to you, make sure you consider their proximity to your neighborhood before getting lost in visions of porch swings and curtains.
Be aware of the condition the home is in.
You may think you have found your dream home, but keep in mind any extra stress or costs that may come up when you’re learning about that crack in the wall or the furnace system from decades ago. If you’re going for a fixer-upper, make sure you have factored in time to your moving process, in addition to additional expenses. (Also note that an FHA203(k) will allow a buyer to finance qualified repairs).