No pre-qual, no problem?
Close your eyes and picture this scenario… You have been touring homes for a few weeks. But none of the homes were a good fit for your family. Then one sunny Saturday morning of viewing homes. You pull up to the house and this one feels a little different, your agent opens the door, and you immediately fall in love. It has the most gorgeous entryway, full chef's kitchen, enough bedrooms and space for your family, and did I mention that gorgeous backyard for all the activities? You look at your agent, and immediately your agent knows you want this house. There is an offer deadline for 7pm this evening so we better get started on the offer.
Now let's add a little spice. You are NOT pre qualified yet. No problem right? Oh, it’s a Saturday morning, your bank is closed. Now your agent is in a mad rush trying to find a lender that can spit out a pre qual within a few hours. Her go to guy? He's sitting on the beach right now, not a computer in sight. Now what? You missed out on the house of your dream, because you did not want to get pre qualified prior to viewing homes.
Don’t be this guy. Don’t make this horrible mistake. Get the pre qualification process started.
There are many reasons we need the pre qual done prior to viewing homes.
What kind of loan will you have? There are several types of loans. The 4 main ones are Conventional, FHA, VA & USDA (with some others in there as well). We need to know what kind of loan you qualify for prior to viewing homes, as some homes will only go cash or conventional.
Do you need seller assistance? Seller concessions or seller assist is where the seller helps to pay some of the buyer’s closing costs. We have not seen a lot of this the past few years with the market, but prior to 2020 seller assist was very common. With our market shifting, I foresee it coming back as well. A seller can contribute as much as 6% towards the buyers closing costs. For example. If the closing costs are $10,000, a seller could give up to $6,000. Why would a seller do this? Well prior to it being a seller’s market, sometimes this would be negotiated into an offer to help get a home sold.
What is your purchase price? When you get pre qualified the lender will let you know a few things. You will know the type of loan, an estimate of what your closing costs will be, and the max purchase price you are approved for. The problem with this, is some people do not want to pay the mortgage for the price you are approved for. For example, I have a buyer now who is approved for a $300,000 mortgage. That payment puts them around $2600 a month. They are not comfortable paying more than $2000 a month though, so immediately we started looking at homes in a lower price point. It is extremely important to know what your comfortable mortgage payment is for your new home.
Getting this process started can sometimes be a pain. A good lender is going to ask for your financial information and documentation from the start. This is a good thing though because the lender is doing their due diligence. There is a much less chance of issues popping up down the road as well.
When you are ready to start the process I highly recommend talking to at least two lenders. This way you can see who is going to fit your needs better. You need a lender who will communicate effectively, will work odd hours if needed to get an approval letter out and someone that is qualified and knowledgeable in the industry.
If you need a referral, I have a couple of top partners that I work with and recommend to my clients. They are highly qualified and will make sure you get to the closing table.
Call/text/email me and let's have a conversation about your situation, and see if now is the right time.
Check out the full Youtube Video Here.
Katie Marinacci, Realtor & Productivity Coach
C: 610-764-3139 O: 610-898-1441
katie@thatpineapplerealtor.com
