A while back, I posted a question on my Facebook business page: If you’re in the market to buy a house, which should you do first? (1) Get a Realtor (2) Talk to a Lender (3) Find the House. I only had one response–from a lender–and she answered, as you might guess, #2: talk to a lender. And surprise, surprise! She was correct.
Why should you talk to a lender first? The short answer is, to save time. Wouldn’t it be a shame to find your dream house, make an offer on it and then find out that you can’t get a loan for the amount you offered? Don’t waste your precious time searching for a home that is not in your price range! And don’t confuse what you think you can afford with what your lender thinks you can afford. They are not necessarily the same. And in this case, the lender’s opinion trumps yours (sorry). So before shopping for your new home, first make sure what you can spend. Isn’t that just good common sense? Once you know that magic figure, you can then put all your energy into finding a home in that price range.
So what does it take to get pre-qualified? It’s not nearly as complicated as some people assume. In fact, it can often be done on the phone or even by filling out an online form. You will have to answer a few basic questions concerning your income and your outgo, your work history, your financial history, and the lender will also run your credit report. After all that, the lender will tell you how much you are pre-qualified for. It’s that simple!
Once you have this step behind you, the home-shopping experience is so much less stressful and much more efficient. You don’t have to wonder whether or not you can get financing. You’ve already dealt with that issue. But not only that, you are in a much better negotiating position once you are pre-qualified. If the seller knows that you have already spoken to a lender and gotten the nod there, he/she is much more likely to bargain with you. And if you happen to be making an offer on a home that has another offer coming in, as well, guess which offer gets greater favor from the seller? You guessed it; the buyer that has already done his homework.
So shop smart. For greater efficiency, peace of mind and negotiating power, talk to a lender before you start your house-shopping experience. If you need help getting started with this step, contact me. It will be my pleasure to serve you.
