Spring weather brings with it a sense of optimism and excitement for most of us. This excitement is particularly in full force in the real estate market, as new home buyers are feverishly searching for their new home.
Inventory has been very tight for the last year. As the weather gets warmer and sellers list their homes, many buyers are competing for the same home. If you do not have your financials in order, however, you will have an extremely difficult time pursuing your purchase.
When you do find that home you want and are excited to make an offer, you will have to submit a mortgage qualification letter and a "proof-of-funds letter with your offer. If you do not have these documents in hand, it will be difficult and nearly impossible to have your offer accepted. Having your realtor show you homes where you are planning to spend the next several years can be a fun and exciting process, but if you come to the table unprepared, you are unfortunately wasting your time — and your realtor's time.
Give yourself and your significant other the best shot at purchasing your new home. Ask your realtor to provide names of a few mortgage providers that they have had success working with. Spend the time with your mortgage lead to get yourselves qualified. You can then feel comfortable making an offer on a home that you and your person can afford. This will make the process much more enjoyable and seamless.
Think about your quality of life and job prospects before you head for the very high end you qualify for. Just because you can afford an 800k mortgage does not mean you should max out your buying limit. I have a client that can afford 750k homes, yet will not go above 525k. Their plan is to not be tied to meeting hefty bills every month. This is the second hurdle you should discuss before looking at homes.
When you see a shiny new home that’s above your budget, don’t jump on it. Buy the neighborhood and schools you like and then the house that you can make bright and shiny.
Here are 6 things you must do before buying a home:
When your financial house is in order, you are perfectly positioned to get into the home buying game. However, this doesn't mean that everything will go your way. More often than not, many home sellers may not be as organized as you. Their inability to purchase their next home, could, in turn, become your problem as you attempt to buy the home they are looking to sell.
Be patient and know that by having your finances in order, you have put yourself in the best position to make deals happen.