How to Buy a Home - Step Five: House Hunt in a Hot Market
If you didn’t catch our last blog post on choosing a real estate agent before you start your home search, you can get caught up here. In today’s blog, we take a look at the fifth step to purchasing a home: how to house hunt in a hot market. Today’s housing market is hotter than ever. A decade of underbuilding homes has caught up just as demand from the pandemic is hitting an all-time high. With the continuation of record- low mortgage rates and lack of housing supply, the market is not expected to cool off anytime soon. If you’re house hunting in 2021, you can expect to be up against a lot of competition and it may take longer than usual to win a home. In a market this aggressive it’s likely you will only have one chance to see a home before you submit an offer and you may find yourself in a same-day bidding war. So, if you do see a property you like, you will need to put your best foot forward! Prepare as though you will be submitting a same-day offer In a market this fierce, there is a good chance you will not get to see homes at your own pace. The time you are given to spend looking at a house will be rushed because most homes on the market right now have back-to-back showings. Preparing beforehand will allow you more time and space to focus once inside the home and help you reduce mistakes or delays. Make a day of it To make efficient use of your time, make a day of it. Give your agent some lead time to line up as many private showings as possible in one day when you are available. If you want to see as many homes as possible during daylight hours, you might want to consider skipping a break that day and starting in the morning as early as possible. Likewise, it would be wise to avoid making plans for that evening in case you end up submitting an offer that same day. Write down your wish list Write a list of wants and needs for the home, then prioritize each list. If you’re buying a home with a spouse, make separate lists and compare. Review with your real estate agent before and then revisit after seeing 10 homes as a reality check on your price point and to narrow down the list. Do your homework Ask your agent to research “comps” for the neighborhoods you are targeting for your hunt. Studying MLS data of recent sale prices in the neighborhood ahead of time will give you an accurate reality check on the current value. Don’t rely on being able to pull up an online estimate while you’re touring the home. Remember: the data that is compiled by third-party sources on the Internet and is not always correct or consistent. Ask your agent to generate a comps report and then walk you through it. Try to have this conversation at least few days in advance so you have time to review and are educated on the market prior to house hunting. What to Bring Cash Approval ™ or pre-approval letter dated within last 30 days Measuring tape Anyone else who has a stake in the purchase decision. Again-you might have only one shot to see the house before submitting an offer, so you’re going to want to make it count. Pro-Tip: Ask your agent to prepare a folder with a hard copy of MLS sheets for each house you are seeing. Writing some quick notes on each home’s MLS sheet will help keep the details of each home organized in your head for reviewing later. The MLS sheets will also provide you with valuable information on the home and community including the price and date when the home last sold, property taxes, HOA fees and restrictions. What to look for when touring a home Make yourself at home and test drive everything If you are absolutely certain that you don’t like a home, it’s ok to pivot and cut the tour short. On the flip side, if you do like it, take your time and make the most of it. Don’t be shy-this is your time to test drive the house. It is critical that you can see everything in the home clearly. Make sure all the lights are on and the curtains and blinds are open. Bret Weinstein, Founder and CEO of BSW Real Estate prefers to split up from clients when touring a home to maximize the time. “My job is to walk through the house at the same time as you. And then we can meet up at the end and I can point out any material issues I saw, like is the home structurally sound? I want my clients focused on whether they feel like they could live in the home and would feel comfortable. My job is to walk through and make sure that the house is going to pass an inspection.” Checklist for interior and exterior Engage your senses when touring homes. Does the home smell stale or musty? Can you hear traffic from the street or highway? Do you see wear and tear that wasn’t visible in online photos? Here’s a quick list of what to check for both inside and outside the home: Interior: Natural light and views Width and type of stairway Closet and storage space Plumbing and water pressure Type of flooring in each room Age and condition of heating and cooling systems Age and condition of appliances Measure for furniture Exterior Property boundaries Garage size Landscaping Porches, covered patios and decks Age and condition of roof Age and condition of windows Exterior doors Proximity of neighboring homes and how well they maintain their yard Pro-Tip: When surveying the interior and exterior of a home, it’s important to be honest with yourself and separate logic from emotion. Don't let cosmetic features like wallpaper that are easy or affordable to fix or replace dictate a homebuying decision. Determine what your budget for repairs, replacements and renovations is going in and focus on calculating the big-ticket items that can be expensive or intensive to fix like replacing a roof or heating and cooling systems. Recognize that certain things like the floorplan can be costly to modify, but things like showerheads are not and probably shouldn’t carry too much weight in your decision. How to take notes and stay organized when house hunting It’s very common for homebuyers to finish a long day of house hunting and struggle to remember individual houses- everything becomes one big blur. Do yourself a favor and take 5 minutes for notes, pictures and videos while you are in the homes. Give each home a rating of either A, B or C and jot down some quick handwritten notes on the home’s MLS sheet so it is easier to connect the dots later. Walk through the home once and for “A” leads that are top contenders, take a second walkthrough video tour of the home by starting on the street where you can begin filming the block and neighboring homes as you walk inside. Pro-Tip: Write down a few features or personal impressions that stood out about the home that will jog your memory later such as, “house smelled like curry, fire pit in backyard, Kim Kardashian walk-in closet Top 10 Questions to ask the seller’s agent Other than price, what is the seller looking for in an offer?Why are the owners moving? Where are they going?How long have the current owners lived here? Were they the original owners? How old is the home? How old is the roof? How old are the heating and cooling systems and can they show you show where all are located? Are there any repairs or replacements needed? Can you see a copy of the current owner’s utility and maintenance bills? Have there been any offers on the home? How recently and rejected at what price? Is the seller currently reviewing any offers? How many? When is their deadline for you to submit an offer? Pro-Tip: Don’t be too open in sharing your thoughts and feelings with the real estate agent who is showing you the home. Even if it is not the seller’s agent, it could hurt your ability to negotiate later. Debrief with your agent Give your realtor immediate feedback when you leave the house while it’s still fresh in your head. Let them know what you loved or hated about the house, but specifically-what about it was the deal-breaker. This is also the best time to ask your agent their opinion on the home overall, but particularly, price and value. “As soon as we walk out of the house, I ask my buyers, ‘would you buy this home, yes or no?’ says Weinstein. “If the answer is anything other than yes then we move on to the next house. I want to get their gut reaction. Because I think that's where there is so much value.” Bring your head but don’t forget your heart With all these guidelines ruling your home search, it can be easy to get caught up in logic, feel overwhelmed, and lose the joy of shopping for a home. But buying a home is very personal and emotional; there is no app or algorithm that can predict what home you will or won’t fall in love with. Don’t forget to take your heart with you on your homebuying journey and look for the “wow”-that moment you walk into a home and something about it takes your breath away or makes your head turn. Something about it that makes you feel at home. House hunting can feel like a competitive sport in 2021 and easily leave you discouraged at the end of the day. But if you take a little time to prepare in advance and be proactive about it, you’ll be ready to submit a winning offer the same day you find the one.
Jennifer Shapiro | Apr 8, 2021
How to Buy a Home - Step Four: Choose a Real Estate Agent
If you didn’t catch our last blog post on choosing a neighborhood before you start your home search, you can get caught up here. In today’s blog, we take a look at the fourth step to purchasing a home: choosing a real estate agent. Why do I need a real estate agent if there’s Zillow? In today’s high-tech DIY world, surfing real estate listings online has become an American pastime. Shopping for a home in your pajamas on your couch has never been so convenient. But, what happens when you want to see a house in person? And…what if you fall in love with that house and want to submit an offer on the spot? What should you offer? What are the other homes in the neighborhood selling for? Once you’ve been Pre-Approved or Cash Approved™ and are ready to move from scrolling on Zillow to unlocking the door to your dream home for the first time, you’re going to need the right real estate agent. Although showing homes is a big part of an agent’s job during the house hunting phase, it’s important that you understand how an agent can help once you purchase a home and it goes under contract. As with any profession, there will be good and bad apples. While an average agent might complete only the minimum requirements to cash out on his or her commission, a good agent will wear many hats throughout your homebuying process including negotiator, problem solver and therapist. Remember, buying a home is one of the biggest purchases of your life and an agent can make or break your homebuying experience, so it’s vital you pick one who will get you to the finish line. Here are some tips to consider when you’re choosing a real estate agent: Do’s and Don’ts of where to look for an agent When looking for an agent, you can use many online tools for research. But don’t dismiss interviewing agents face-to-face to get a feel for how they communicate before making a decision. Here are some things to keep in mind: Do ask trusted resources such as friends and family if they have had a good experience with an agent.Don’t hire someone simply because they are a family or friend connection.Do visit open houses and check out “for sale” signs in the neighborhoods you are interested in. Consider interviewing agents hosting those open houses. Take note of which listing agents and brokerages are most active in that area.Don’t determine how much an agent can or can’t help you based solely on their current book of business.Do look up online reviews of agents and take them into consideration.Don’t make a decision solely based on reviews or online presence, though. Many successful veteran agents choose to not focus on technology for marketing.Do look for an agent who has experience helping clients similar to you (first-time homebuyers, empty nesters).Don’t make an agent’s experience with clients a deal-breaker, however. Find an agent who knows the neighborhood An agent's ability to “pull comps”-a list of comparable homes that have sold within a specified area and time frame is one of their most valuable assets. The ability to argue or defend how comparable sales affect market value of the property will be one of the most powerful tools when negotiating price. An agent should have a thorough understanding of the housing inventory in the neighborhood you are interested in. They will know what has sold or not sold recently. Find an agent who has experience managing and closing transactions Showing homes is a critical part of how agents help you, but an agent’s ultimate job is to close your deal. They don’t get paid unless it closes. On House Hunters, we see homebuyers choosing a house and in the next scene, they’re playing football in the backyard as the credits roll. In real time though, closing a home can take weeks. There are hundreds of laws, contingencies and deadlines in a real estate transaction to address. There will be a number of people working on your transaction, including a lender, an inspector, a title company, and possibly an attorney . These professionals will make up your homebuying “dream team” and your agent will be the glue. A good agent will know how to navigate your purchase agreement. They will be proactive in making sure you satisfy all requirements and deadlines from the moment you submit an offer to closing on a home. They will be the central point of contact for the seller’s agent and your dream team. Need a survey? Need original building plans or copies of permits? Need an extension on your inspection period? Your agent should take responsibility for directing and coordinating all of these processes and people and advise you every step of the way. They will advocate on your behalf when they are legally able and they will know when they aren’t, such as in the case of an appraisal or inspection report. Don’t try to DIY a Realtor’s job. You will need a licensed professional who understands real estate laws and regulations for your state. What does a good agent look like? Know there will be unexpected challenges on your transaction so hire an agent who is a creative problem solver and can work cooperatively with the seller’s agent and your dream team to close the transaction on time. A good agent has more than just industry experience and market knowledge. They need to be able to troubleshoot problems cooperatively and effectively with the seller’s listing agent. Here are some indicators to look out for: Red Flags Impatient, aggressive or pushy behaviorThey persist in steering you down a path you don’t want to pursueThey offer a discount on their commission as a reason you should work with themThey don’t follow up on your communication the same or next dayTheir broker doesn’t have an established or good reputationThey are picky in what they will or won’t help you withThey speak poorly of other agents, brokerages, buyers or sellersThey make you uncomfortable in any way Green Flags They are persuasive and can develop a good rapport quickly with anyoneThey are patient and flexible with you-even if you keep changing your mindThey are creative and cooperative with other agents in solving problemsThey are always a few steps ahead of the homebuying process when preparing you and the paperworkThey are responsive with a high sense of urgency for deadlinesThey are good listeners and empatheticThey are trustworthy and make you feel comfortableThey are natural educators who explain the process clearly Pro-Tip: Understand that only sellers pay real estate agents a commission. Be wary of agents offering discounted commissions upfront for service. An agent’s commission can be negotiable and sometimes an agent will contribute a portion of theirs as a “best and final” negotiation strategy they keep in their back pocket to push a deal over the finish line at the right time and get it closed. Here are some questions to ask any agent before hiring them How long have they been in the business? More importantly: how many transactions have they closed and when was the last one?What days and times are they available to help you? Does it coincide with your schedule?Are they part of a team or do they work alone? Do they have an assistant who you will be relying upon?How do they communicate? Do they only text? Do they return calls or texts on the same day?How long have they lived and sold real estate in the area? What neighborhoods do they focus on? What is their knowledge of that market and do they see any patterns or trends?What are the comparable properties that have sold in the neighborhood during the past 6-12 months? What are their opinions about price, housing inventory and other trends for purchasing in that neighborhood?What is the median price of a home in your ideal neighborhood? Do they think your budget and timing is realistic?Do they have confidence that the lender you want to work with can close the deal as fast as you need?Will they represent only you as a buyer’s agent, or is there any chance they will represent the seller as well? Ask what the laws are in your state and what their position is on this.Can they walk you through a purchase agreement and explain how they will be paid?Can they walk you through the homebuying process from offer to close of sale? Go with your gut You must be able to trust your agent completely. Feeling comfortable and having chemistry with your agent is something that only you can determine. Just as important as an agent’s knowledge and experience is their ability to guide you smoothly through a transaction. You can expect bumps in the road throughout your homebuying process, especially in a highly competitive market. You’ll want to work with an agent who is resilient with these setbacks and equally encouraging to get back on it until you close on a home. Don’t forget: when you pick an agent, you are choosing who will be your primary advocate to the seller and your homebuying dream team. If you work with a good one, your chances of securing your dream home will be much higher!
Jennifer Shapiro | Mar 24, 2021
How to Buy a Home - Step Three: Choose a Neighborhood
If you didn’t catch our last blog post on how to find financing and make sure that you are either pre-approved or Cash-Approved™ before you begin your home search, you can get caught up here. In today’s blog, we take a look at the third step to purchasing a home: choosing a neighborhood. It’s All About Where You Live: Location, Location, Location! Real estate can be summarized in one word: location, location, location. The most important factor isn’t the house itself- it’s the neighborhood. What makes a neighborhood great? The answer is different for everyone depending on their stage of life and what matters to them. Here are some things to think about as you consider where you want to call your home. “You’re buying the area… the house is just along for the ride.”-Barbara Corcoran, Founder of The Corcoran Group The Practical Side: Does the Neighborhood Check your Boxes? It can be difficult to know what all your priorities in a location are or should be, so a good place to start is by asking yourself a few simple and practical questions. How much can you afford?What is an acceptable daily commute?How far are you from schools and what is their rating? What if you don’t have children, though? Should you still care about a school’s rating? Yes, because of the potential resale value. Future homebuyers of that house might have children and care. And since over half of buyers have children, it is fair to say that a school’s rating can be an important factor in determining resale value. Pro-Tip: When picking a neighborhood keep the resale value, the amount that a home is expected to sell for at some point in the future, in the front of your mind and as part of your criteria for selecting a location. School ratings, nearby commercial development or public utilities like power lines -all things not in a home, but, near a home’s location, can affect the perceived future value of a home. Study the Area within a 1-Mile Radius Can you imagine buying a gown or a tuxedo for a formal event without ever having tried it on until the big night? Probably not. While most people perform their due diligence for a home purchase, they often forget to do their due diligence on the neighborhood and the surrounding area. Why? Well, for one; researching zoning and reviewing HOA rules are not as much fun as cruising open houses and seeing the latest upgrades. When you’re visiting open houses, you’re probably not considering that high school you passed at the entrance of the neighborhood. That school, however, has teenagers-many, many teenagers. Well, what’s wrong with children you might ask? We just said that school ratings are important in picking a good neighborhood and this one is A-rated! So, what’s the problem here? Well, there is no problem- yet. But in October when football season starts there might be. Because where there is a high school there is usually a football team. And a marching band. And Friday night games with stadium lights and boisterous fans. How many games are there again? How late do they go until? Wait- this school hosts a football camp in the summertime for all the schools in the area? Wow. That’s a lot of teenagers close to your home year-round... Pro-Tip: Draw a 1-mile circle around the prospective neighborhood you are considering and identify other residential and commercial development. Ask yourself what the potential impact of these could be on your daily life and if you are ok with it. Take seasons, different times of year, and even traffic patterns into consideration. Who are the People in the Neighborhood? Have you Chatted with Them? It’s very hard to foresee all the possible scenarios, both good and bad, that living in a certain neighborhood might introduce into your life. But not if you’re a person who already lives in the neighborhood. Those people? They know the drill, and they probably aren’t afraid to tell you what they do or don’t like about their community. Unlike real estate agents, lenders or sellers, the people in a neighborhood aren’t motivated to sell you anything. They will be open in sharing what they do or don’t like about their community. Where and when the traffic jams are the worst, how often there are additional HOA assessments, and if the neighbors are dog people? Want to know if a community’s Homeowner’s Association is on the strict side with parking? Ask a neighbor. Want to know if the community culture is a social one with silly hat parties and Wednesday Wine Downs or if people keep to themselves? Ask a neighbor. Need to know where you can get the best New York- style pizza versus Chicago style? You got it. Realize that whether you plan on being social or not, you are going to have neighbors and other people you interface with daily when running errands or enjoying leisure time. Who are the people in the neighborhood? Are they families with children? Empty nester retirees? Young professionals? Renters? Ask yourself: How important is it that the people who live in your neighborhood are in the same stage of life as you? Do you want to be social? Do you prefer privacy? Will they still be welcoming if you don’t want to participate? Love a golf course view but not the game? It’s all good. But we do recommend you find out how early in the morning those golfers may or may not hit a ball straight into your poolside morning meditation practice and throw off your zen. Pro-Tip: Remember that because of The Fair Housing Act, realtors are very restricted in what they can say about “what kind of people” live in a neighborhood. They are also not allowed to talk about crime statistics. It will be up to your own personal research to find data and assess if you feel safe and comfortable. How to Try a Neighborhood on for Size Adopting the daily lifestyle and commuting patterns of a location by going different places on different days and times will let you know its true character so you can get a sense of what life is like on a weekly basis. Test the traffic on different days and different times by commuting from a prospective neighborhood to your place of workGo for a walk after 5pm. If you’re a dog person, bring your pooch. You can tell a lot about a neighborhood by the locals who walk them every dayPark in different locations on different days at different times-yes, that’s right; stake the place out. Sure, that street seems quiet on Wednesday at 11 am, but that doesn’t tell you if the college kids living in the rental home next door will be hosting a Kegger on a Saturday nightGo out to eat-whether you think you will eat out a lot or not, you can learn a lot about a place and its people by test driving dining options that are nearby Life is Short, Find your Happy Place In a low inventory housing market, it can be an incredible challenge to secure a perfect home or even one you feel really excited about. While there are many things you can do to renovate a home after you close on the sale, there is nothing you can do to change the vibe you do or don’t get from a community and its “sense of place”.Do you feel comfortable and welcome when you are there? Are people friendly and warm? Or do you feel like a visitor? Feeling comfortable is key. How do you like the scenery leading into the neighborhood? The entrance? Are there trees, trails or beautiful views? Does the thought of pulling into the neighborhood at the end of every day lift you up? Before you begin house hunting, don’t forget to go “happy hunting” and find a neighborhood that feels right. You are less likely to make a hasty decision and end up with a bad case of buyer’s remorse if you take the time to learn the neighborhood first. A neighborhood is where feeling at home and belonging should begin and end every day. Your location will dictate many of the people you meet and the experiences you have, so choose wisely. We hope you this post will help you find a neighborhood where you feel welcome and can call home. Where to Look for More Helpful Information: School board website-this is where you should be able to confirm a school’s ratingLocal police stations– this is where you can get statistics on crime. Note: The Fair Housing Act prohibits realtors from talking about the crime rates so you must come to your own conclusionsCity and County - this will tell you everything you need to know about the local governmentFacebook groups and app’s like NextDoor -these can be very helpful in connecting to locals
Jennifer Shapiro | Mar 17, 2021
How to Buy a Home - Step Two: Find Your Financing
In case you missed it, in our last blog post, we talked about how to know if you are ready to buy a home. In this blog post we talk about the first step in buying a home- which is securing financing. Financing will make or break a deal The single most important distinguishing factor between an attractive or a weak offer is the type and quality of the financing. Knowing this, it makes sense that the next step on your journey toward homeownership is getting your financing squared away. This typically means either getting pre-approved for a traditional mortgage or getting Cash Approved™ with Accept.inc. A buyer who has the full cash amount in their bank account doesn’t need to worry about this step. Two options: Pre-approved or Cash Approved™, what’s the difference? When buying a home there are two things to keep in mind: first, how to win the home, and second, how to pay for the home once it becomes yours. A mortgage is a financing instrument used to pay for a home. Unless someone has the cash to cover the entire purchase, they will need to apply for a home loan.There are two options to securing a home loan:Getting pre-approved for a traditional mortgage.Getting Cash Approved™ to make an all-cash offer that is backed by an Accept.inc mortgage. In the traditional mortgage process, a loan pre-approval happens upfront. The underwriter doesn’t start the process of review however, until the home has gone under contract. This can take up to 4 weeks to complete. With an Accept.inc all-cash offer, the underwriter reviews the file before the home goes under contract, which can be done in as little 72 hours. This can be done as soon as you are ready to apply for a home loan. Both a pre-approval and a Cash Approval™ will give you a way to finance the home. The difference is in the strength that each brings when presented as part of an offer.Before you can pay for the home, your offer needs to win With a Cash –Approval™, you are not only approved for a mortgage before you submit an offer on the home, but you receive an enormous additional benefit: you are also approved to submit an all-cash offer! Similar to how a 0% credit card works, Accept. Inc will front the cash for any borrower who they have approved for a mortgage at no additional cost. This enables you and your agent to shop and negotiate with the power of cash. In case you didn’t read our blog on why cash is becoming the new standard; cash offers have a 4X higher win rate on average nationwide. If you want an overview of just why cash offers are stronger, check out the post we wrote on Why Cash Offers are Quickly Becoming the New Normal. Remember: First you need to win the home. Then, you need to pay for the home.Ignorance is not bliss when it comes to securing financing Many people procrastinate on securing financing before house hunting. Perhaps because they are nervous of hearing bad news like they won’t qualify for the home they love... or any home. Perhaps it just seems too complicated or daunting. Shopping for a home without applying for a home loan is like shopping at the mall without your wallet. If you’re serious about making homeownership a reality, you will want to find out your purchasing power (how much of a loan or cash offer you are approved for) before going any further. With a traditional mortgage pre-approval, you still may not fully know your buying power after pre-approval. If you’re curious as to why, read our previous article on the risks offers with pre-approval letters face. If you apply for financing and are not approved, don’t fear. A good Loan Officer (or Approval Specialist if you choose Cash Approval™ from Accept.inc) should give you a roadmap, custom-tailored to your finances and timing to help you obtain the approval you need.Decide what is a comfortable monthly payment You will want to do the math on what your monthly mortgage payments will be, based on your down payment, before you begin looking for a home. While a lender may tell you that are approved for an even larger monthly amount, only you know what is truly comfortable and safe to maintain. Being able to afford the monthly payment is the #1 factor you are committing to when purchasing a house. A good rule of thumb is that your monthly payment should be approximately 30% of your monthly salary.Pro-tip: Don’t forget about these costs in addition to your principal when calculating total monthly payment:Don’t forget about maintenanceDon’t forget about interestDon’t forget about taxesDon’t forget about insuranceDon’t forget about Homeowners Association dues (HOA)Prepare for your prequalification call or application BEFORE you look for a home! Imagine this, you’re at an open house that you happened to drive by on a beautiful crisp Sunday morning as you were coming home from picking up bagels. You know your realtor said not to go to any of these without them, but it’s ok, you’re not going to stay. Just a harmless pop -through to pick up some information. As you walk through you notice that there are high ceilings, natural light, a split open floorplan. Hold on....you actually like this house! Once, then twice, you make your way through the house to the backyard. No way! A pool?! You do another lap of the home and ask the realtor for a price sheet. You’re surprised and delighted to see the price is only slightly above your budget! How can this be? In this neighborhood? The realtor tells you the owner is going through a messy divorce and wants to parachute out immediately. They tell you that if you’re interested, you should put in an offer today because they are reviewing a short list tonight. Two hours later, you and your wife are combing the house with her parents on FaceTime, taking pictures of the walk-in pantry and videos of the backyard. You’re in the three-car garage measuring how many feet the third bay is, when your realtor comes running in frantically waving her cell phone and sticking it in your hand. “Here, this is Mark, he’s a loan guy, tell him your social. He’s gonna ask you some questions so he can get us a pre-approval letter for the offer I’m writing up in my car-HERE, say hi,” and with that, she shoves her iPhone up to your ear. Like a zombie with a craving for open floor plans like brains, you jump right in. “Hello, Marcus?” you reply. “Heyyyy man, what’s up? Yeah, I'm good man, I’m good. This home has a three-car garage! Yeah, I got 15 minutes right now, sure!” Mark/ Marcus/ the loan guy/ the mortgage bank guy, what’s -his-face, proceeds to ask you all kinds of questions about your income, your debts and you ramble off a bunch of quick numbers. He says he has everything and just needs to speak with your wife. Next thing you know, she’s talking to Marco while you’re FaceTiming your mother-in-law, showing her the Koi pond. (..Friends, this is not the time nor place to try to and remember the interest rate on your student loan) Sadly, this is how many pre-approvals happen. On the fly, with a stranger, under and the pressure of a dopamine rush brought on by closet barn doors and subway tile backsplashes. Remember how your realtor wanted you to prequalify in your first meeting and you said you’d think about it? Well, here we are...Two things you can do to be proactive in your home loan application: First, find a lender you want to speak with by doing your own research or asking for referrals. Talk to other people (including your realtor, if you already have one) who have had positive experiences. A lender plays a critical role in your home purchase, just as much as your real estate agent. Remember, you are assembling a dream team. It is pivotal that your agent and lender communicate and work well together in case your transaction hits bumps in the roads (and undoubtedly it will.)Some things to keep in mind when choosing a lender:They are trustworthy, transparent and have a good reputationWill they help you win? This is a good time to weigh the benefits of an all-cash offerYour realtor has confidence in them and wants to work with themYou are comfortable talking with themThey are knowledgeable about interest rates, discount points and lending guidelinesThey are creative and strategic and don’t give up easily, they are skilled in the art of finding a solutionThey call you back in a timely manner and have flexible hours of operation –you can always get them on the phone when you need themCustomer service, customer service, customer service... Pro-Tip: Don’t wait until you’re in the middle of a conversation with a lender to figure out the answers to the following:Understand the difference between a pre-approval and a CashApproval™Understand that while there is convenience in filling out an online application, there are benefits to building a relationship with a loan officer and troubleshooting your approval through verbal conversation Understand that all answers you give will have to ultimately be verified by the underwriter with documents as evidenceHave copies of your tax returns and/or W2’s or 1099’s, pay stubs and bank accounts in front of you for easy referenceKnow the specific balances and interest rate of your credit cards and other debts- make a list if needed-this is not a time to wing it!Be prepared to have your credit report pulled. This will be a hard pull, but rest assured that pulling your credit report with multiple lenders to shop competitively for a home loan will not lower your FICO score dramatically.Be prepared to back up what you say in the call with paper proofMove forward with confidence, and don’t settle for less than either a pre-approval letter, a Cash–Approval™ letter or... a plan to get one At Accept.inc, we upgrade offers to cash, because we believe that anyone who can qualify for a mortgage deserves an equal chance at home ownership. We offer homebuyers who qualify for a mortgage the ability to make all-cash offers on a home at no extra cost. This gives sellers the speed and certainty they seek, while giving buyers the strongest chance of winning. In a competitive real estate market, nothing will push your offer to the top of a seller's list faster than offering cash. Because there are no additional costs to get Cash Approved™ and buyers are free to work with any real estate agent they choose, many say Cash-Approval could one day replace the traditional mortgage pre-approval letter. We know we’re a little biased, but whether you decide to go the traditional mortgage route of getting a pre-approval or a Cash Approval™ with Accept.inc, we still encourage you to find your financing first for that dream home.Time is of the essence in real estate. Do yourself a favor and find out your spending power from day one. Make it step one, not nine of your real estate search. The sooner you start, the faster you can get into your dream home.
Jennifer Shapiro | Mar 10, 2021