Top 5 Things to Consider When Buying a Home
If you are thinking of buying a home, there are a few important components to keep in mind. By knowing the Top 5 Things To Consider When Buying a Home, you will be prepared to start your home purchase and financing journey with a clear picture of where you want to go.
1. Not All Home Search Sites are Created Equal – Have you been searching on Zillow or Trulia? If so, the information surrounding purchase price and whether it’s even for sale could be drastically outdated. The only way to get up-to-date listings of homes for sale is to go directly to the source — Ask your Realtor. Licensed real estate agents can give you behind the scenes access to all types of homes listed for sale, days and weeks before they show up on Zillow or Trulia. Ask your Realtor today and they can setup a custom home search to notify you as soon as a home meeting your criteria comes on the market.
2. Credit Scores Can Cost you Time and Money – Your credit score is a major component of financing a home. Your credit score will have a direct impact on your interest rate and how much you pay each month, and could keep you from buying a home altogether. A one point difference in between a 679-680 or 739-740 could cost you thousands of dollars at closing or tens of thousands over the life of your loan. If you have not seen a copy of your credit report, it’s important that you know what is reporting so you have time to address any issues that may be impacting your scores or reporting incorrectly. As part of your initial loan consultation, we are happy to provide a complimentary credit analysis so that you know where you stand and can start taking any action to ensure you have access to the lowest mortgage interest rates when you buy.
3. 20% Down payment? Only if you want to… – Contrary to popular belief, a 20% down payment is not required to buy a house in most cases. Thanks to programs like FHA and Conventional loans with mortgage insurance, you can finance up to 97% (FHA up to 96.5%), and even 100% on VA and rural USDA loans. Ask us about buying a house with 5% or 10% down with no monthly mortgage insurance.
4. Are Your Ducks Docs in A Row? – The underwriting approval process has changed considerably over the last few years as lenders and Banks require more documentation in exchange for a loan approval. The horror stories typically come from people that were not prepared as they started the buying process and It’s important that you gather as much of your documentation as possible to review with your mortgage professional. These documents also help you to take the steps from pre-qualified to pre-approved:
- one month pay stubs
- 2 years tax returns (corporate/business if self-employed or owner of 25% or more of business)
- 2 years W-2s
- 2 months bank/savings/investment statements
- Driver’s license / social security card
- Other items that may be applicable: retirement/social security income, divorce decree, bankruptcy filing/discharge…
5. Get Pre-Approved before you search – Now matter when you’re planning to buy a home, it’s never to early to get pre-approved. In fact, if you are even thinking about buying a home, pre-approval is likely going to be required for an offer to even be considered by a seller. Not only that, pre-approval will help you know exactly what purchase price you should be targeting to end up with a monthly payment and out-of-pocket expense that you are comfortable with and eligible to finance. Could you submit a qualified offer today if your dream home appeared on the market? If you can’t answer with a resounding, YES!, we can help you.
Mortgage interest rates and home prices have been creeping higher across the country. While we don’t know if the trend will continue, we do know that interest rates are still near historic lows and home prices in our area are some of the most affordable in the country.
Take advantage of this opportunity and Get Pre-Approved and Ready to Buy
or Call Us today at 972-499-0454.
