As a loan officer who specializes in first time home buyers I have learned a few things that will help make the process smoother and less stressful. Here are 3 things I would advise my family member to do if they came to me for advice about buying a home.
#1. Hire professionals and trust them to do their Job - We are primarily compensated for our specialized knowledge. Leverage our expertise to help you accomplish your goals. Ask us before you make deposits or move money around. Lenders now scrutinize bank accounts very closely & will ask about even small deposits. Don't take out additional credit, don't open another Dept Store card for the discount... at least not during our process.
I have seen settlements delayed, contracts fall apart and lots of ruffled feathers because of lack of communication between Buyer and their Lender. Generally speaking, consult your Loan Officer prior to ANY financial move you make during your loan process. Even the smallest actions may cause you now to verify where they came from & to show a paper trail. It can become quite tedious.
#2. Educate yourself - You can quickly find tons of information about different loan options on the internet. Stay away from message boards and websites that are obviously for out of state lenders. Some programs have specific guidelines in each state. It's very important to find local lenders, not only because they will be better informed... but also much more accountable when you can physcially show up at their office.
I frequently see buyers put in the wrong program by mortgage lenders. They might not offer a particular program, know about the program, or just don't want the extra work of having to submit all the extra paperwork for all the different down payment assistance, no money down or local mortgage programs.
I have seen many borrowers in a FHA loan when they were eligible for a USDA loan or other better suited program.
#3. Get Fully Pre-Approved - If I could only give one answer, it would be to get fully approved through underwriting before calling a Realtor or especially putting a contract on a house.
One of the most common calls I get are from people less than 10 days from settlement and their lender just called to say that there is a problem. The buyers are desperate for help and scrambling to get someone to approve them.
At this point the appraisal has been paid for, the landlord was put on notice, and everything around them is focused on moving in a few days. Many times the lender didn't do their full diligence upfront with this Pre-Approval, or didn't submit a thorough detailed loan file for Underwriting.
BJ Matson, Realtor®
Home Buying Advisor • RE/MAX
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