Purchasing a home is an overwhelming process, one that you simply can't navigate alone. At the very least, the two people you'll want to have close by your side are your mortgage expert and your real estate sales professional.
YOUR MORTGAGE EXPERT:
You can't start looking for a property before knowing what you can afford, and then giving your real estate representative a clear home buying budget to work within.
Your loan representative can assist you in figuring out your available housing budget by calculating your mortgage pre-qualification. Together with this calculation is direction on where your down payment funds can come from and what kind of documentation is necessary to ensure a clear, legal transaction. Once you get closer to making an offer on your dream home, you can then take the next step and have a mortgage pre-approval drawn up, a document confirming that the lender is willing to consider giving you a home loan up to a specific amount, which can create a strong advantage when bidding on the home.
Some advice that buyers can benefit from in their quest to secure the best mortgage product includes:
- Check, correct and improve your credit score as necessary.
- Pay down any existing debt before considering taking on new debt.
- Don't apply for any new credit cards, loans or lines of credit as you work your way through the home buying process. Applying for a new credit card or a loan reflects on your credit report. It can lower your credit score, your eligibility for a mortgage or the final interest rate you're offered.
- Get your papers in order, starting with your banking and financial statements, tax returns, residential history and employment records.
- Don't make any sudden moves. The time to switch jobs is not when you're in the process of applying for a mortgage. You will need to produce confirmation of steady employment and employment earnings in order to secure your mortgage.
- Refrain from large spending sprees. Even after you receive approval for your mortgage loan, be aware that the mortgage company will monitor your finances until the home closes to ensure you don't take on any additional debt. Do not make any large purchases — that means no new car, no new appliances or large furniture purchases for your new home— until you actually own the home.
YOUR REAL ESTATE SALES REPRESENTATIVE:
Whether you're buying or selling, it's no secret that a home transaction is a major financial undertaking, an emotionally harrowing experience, and a legally complex transaction, and that's why the majority of today's homeowners secure the services of real estate professionals.
If you're looking to buy a home, your buyer's agent will research properties that meet your criteria, make arrangements for you to view them, and then negotiate on your behalf. If you're selling a home, your seller's agent would be responsible for advising you on how to prepare your home for the best possible sales outcome, professionally marketing your home, and then negotiating with buyers for a smooth and successful sale.
Your real estate representative will take care of liasing between you and the buyer or seller as applicable, and then taking care of all the paperwork in a smooth and efficient manner.
Knowing and then negotiating fair buying and selling prices isn't for the faint of heart — or the average homeowner! An experienced real estate professional can not only ensure a smooth real estate transaction, but also ensure you are financially protected throughout the process.