People often come to me with online “prequalifications” and the belief that they know their budget. But really knowing your budget is about so much more than plugging some numbers in online and getting a “general estimate”. A qualified lender will take into account your credit, your debt to income ratio, your current lifestyle and future plans. And, at the end of the day, I’m less interested in how much you can borrow versus where your actual comfort zone is – what is a realistic number that will give you your greatest buying power while letting you really enjoy your new home and your life after you close?
Get pre-approved. By getting pre-approved as a buyer, you can save yourself the grief of looking at houses you can’t afford or selling yourself short. You can also put yourself in a better position to make a serious offer when you do find the right house. Unlike a pre-qualification, which is based on a cursory review of your finances, a pre-approval from a qualified lender is based on your actual income, debt and credit history. By doing a thorough analysis of your actual spending power, you’ll be properly prepared to make smart decisions.
Choose your mortgage carefully. There are lots of different mortgage products on the market today – and what’s best for one person, may not be the right choice for another. Again, shopping around with mortgage agents, brokers, etc. will help you understand your options and make the best decisions, both in the short and long term.
Do your homework before bidding. Before you make an offer on a home, we’ll talk about and look at recent, relevant sales in the surrounding area, particularly homes that have closed within the last three months. Real estate is hyper-local so, it’s important to know how your market generally performs. Do houses sell around list price, over, under, by approximately how much? A huge part of my job is knowing those things about our market – and I’ll make sure you are fully educated before you make any decisions!