1) Your credit score – This number is super important, it’s not just about having the high number it’s also about your debt to income ratio. All lenders are going to look at your profile before lending you money for a home so in order to get the best possible home loan you want to speak to a qualified loan representative to make sure you know the whole picture. That may mean you need to do a little cleanup on your credit score and they can usually point you in the right direction of how to go about doing that
2) The same lender who just helped point you in the right direction and gave you a picture of what your loan could look like, will most likely be the same person you will get your pre-approval from. You don’t want to be out there looking for your dream home without it, you want to make sure if you find that dream home you are ready to strike and put in that offer. You don’t want to be waiting to get that loan approval! In these covid times we oftentimes can’t even tour a home without a pre-approval letter because nobody wants people tromping around their house in the middle of a pandemic unless they know they are a serious buyer.
3) Work with a professional realtor, we really are worth our weight in gold. I am not tooting my own horn, I am talking about a lot of my fellow colleagues in this profession. We really care about being your advocate!
Pick someone you enjoy spending a little bit of time with because chances are you’re going to be spending quite a bit of time with them. If you like their personality and you feel secure that they know what the heck they’re talking about, that might be a good fit. Also if you’re a seller please for heaven’s sake do not sell your home without a realtor. Contracts, disclosures omissions and error insurance – too many landmines so please enlist the help of an agent.
4) Anticipate the real cost of owning the home you just fell in love with. Here are some things to consider in addition to your mortgage payment:
- Property taxes
- Homeowners insurance
- Maintenance of the house
These are things to look at so when you’re working with your realtor. Make sure they give you a net sheet so that you can see what all those numbers add up. You want to be certain that the house actually makes sense for you.
5) Be realistic – Some homes are so beautiful but sometimes they’re out of your price range or they’re not in the right neighborhood. Oftentimes people come to the market looking for a home in a particular neighborhood for various reasons. Maybe your kids are going to need to go to school or your family is located nearby or you have an aging parent that you’re going to need to take care of. There are a lot of factors involved in this decision so I would say always start with location first and then move on to the style of the home. Obviously you want a home design that you feel good about but don’t get hung up on little things. If you don’t like the carpet it can be replaced, hardwood floors can be refinished, walls can be painted, and walls can even be knocked out. Make a list of must-haves versus wants. The must-haves should definitely begin with the location.
6) The bonus round – This is a big one! Do not make any major financial changes when you’re in the middle of a real estate transaction!
Let’s say you have taken your pre-approval from the bank and gone out shopping and found your dream home. Let’s say your offer has been accepted (that alone is huge in a seller’s market like this one we’re in now).
You begin to think about all of the things you’ll be needing: a fridge, a washer and a dryer, maybe some new furniture!
You go shopping and they offer you a zero apr credit line so you apply for that credit. Well guess what happens? Your loan company for your new dream home gets a little worried about all this spending you’re doing…They decide to reconsider your home loan and either you now, no longer qualify, or your rate is going to go up! To be safe, if you are getting a home loan, wait until the close of escrow before making ANY major financial moves and that includes a JOB CHANGE.
If you want to know more about how to get your offer accepted, feel free to reach!