Tips for Home Buying
This year has been a tough and unpredictable market for homebuyers, with rising mortgage interest rates and a depleted housing inventory post pandemic.
And while it’s possible to successfully navigate a seller’s market, you have to be strategic.
Buying a house is a major commitment, and most likely the biggest purchase you’ll ever make. The best way to ensure you get the house of your dreams and avoid any costly mistakes is to understand the homebuying process and make sure you’re financially prepared for homeownership before you start.
Here’s everything you need to know about how to buy a house — along with tips to help you overcome the challenges of the current market.
Find the Right Mortgage Lender and Loan
Shopping around is key to finding the best mortgage lender for you. Research different mortgage lenders such as banks, online lenders, and credit unions, among others. Knowing all of your options can help you make the right decision.
Find a lender that’s easy to work with. They need to know the area you’re looking to buy in. Also, answers all your questions, and informs you every step of the way about the homebuying process—especially if you’re a first-time homebuyer.
Also, pay attention to the rate and fee differences among lenders, and factor those costs into your budget. Rates and fees can differ among lenders, even for the same applicant, so be sure you’re shopping around and comparing your options before you settle on one — even a 0.5% difference in the interest rate can save you thousands of dollars over the life of the loan.
Pre-Approval for a Mortgage
Many homebuyers don’t start thinking about financing until after they’ve found a home they want to purchase, but that’s a rookie mistake.
An important step is to find a mortgage lender, the next step is to apply to get preapproved for a mortgage. This typically involves undergoing a credit check and answering questions about your monthly income, your assets, and the home you want to buy.
During the mortgage preapproval process, prepare to prove multiple times that you can pay a mortgage. Lenders may take extra steps to verify each borrower’s employment status, up until the mortgage loan is finalized.
For instance, some sellers may ask for a preapproval letter to let a prospective buyer tour the property. A preapproval letter is typically valid for up to 90 days. It shows sellers how serious you are about buying; it means a lender has already verified important financial information about you, and you know exactly how much you can afford.
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We have more than 38 years of experience in the real estate and title business. Owners Pam Rice and Beth Crox have built their reputations upon the virtues of personal service and integrity. They believe that reputation as an honest and reliable business is the recipe for success.