BLINK Realty Group's Blog
If you’re ready to buy a home, you probably have done a lot of research. One thing is sure: You know you need to get pre-approved for a mortgage. It’s perhaps the most critical step in the process of buying a home for a variety of reasons. There’s down payments and debt-to-income ratios, and other financial issues to worry about. You need to know what type of mortgage you should get. To help you understand what kind of mortgage you need, you should get pre-approved.
Understand The Pre-Approval Process
There are many misconceptions about pre-approvals. First, buyers need to understand that there is a difference between a pre-qualification and a pre-approval. A pre-qualification merely scrapes the surface of your financial state, while a pre-approval goes through everything a mortgage company will need to grant you a loan. You may be pre-qualified for a much higher amount than you can actually afford, for example.
A pre-approval is a lender’s written commitment to a borrower. The approval states that the lender is willing to lend a certain amount of money for a home. The lender obtains the following from the buyer:
- Employment history
- Credit report
- Tax returns
- Bank statements
The time and effort that it takes to get a pre-approval is worth it because everything will be ready for the lender to grant the mortgage once an offer is made on a home. It also gives the buyer an upper hand in finding the home of their dreams. Many sellers require a pre-approval with an offer.
When To Get A Pre Approval
As soon as you know you’re serious about buying a home and are ready to start the house hunt, you should get pre-approved. Pre-approvals do expire after a certain amount of time, but lenders can renew them with proper notice.
The Importance Of The Pre-Approval
Many buyers feel that they can skip the pre-approval process altogether. It has many benefits. Besides giving you a better look at your finances and how much house you can afford, pre-approvals can:
- Give you the insight to correct your credit score and help you correct credit problems
- Help to avoid disappointment when you find a home you love
- Allow first-time buyers to see all of the costs involved in buying a home
A pre-approval is a handy thing to have, and it’s not just because the experts say it’s essential. Getting pre-approved for a mortgage can help you to be more on top of your finances going into one of the most significant purchases you'll ever make in your life.
If you plan to buy a house and want to achieve the optimal results, you should perform a home inspection. In fact, there are many reasons why you should allocate significant time and resources to conduct an in-depth house inspection, and these include:
1. You can gain unprecedented insights into a home's condition.
Although you might have fallen in love with a house when you first saw it, a home inspection may make you rethink your decision to purchase a residence. To better understand why this may be the case, let's consider an example.
If you conduct a home inspection and discover a wide range of problems with a house, you have a tough choice to make. In this scenario, you can continue with a home purchase as planned. Or, you may be able to make a viable argument that a seller should perform assorted house repairs or reduce his or her sale price based on the inspection results.
Ultimately, a home inspection provides you with insights that you may struggle to gain anywhere else. And if you perform an extensive home inspection, you may reap the benefits of this evaluation for years to come.
2. You can avoid the risk of paying too much to acquire your ideal residence.
As a homebuyer, it is important to do everything possible to get the best price on a house. But even if you conduct real estate market research, you risk spending too much on a house if you ignore a home inspection.
With a house inspection, you can learn about various home problems, along with the costs associated with such issues. Then, you can use this information to determine whether your initial offer is sufficient, or whether you should request a reduced home price based on a residence's condition.
3. You can limit the possibility of costly home repairs.
Thanks to a home inspection, you can identify home issues that otherwise may lead to costly repairs down the line. You then can use this information to decide whether you can complete myriad home repairs on your own, or whether professional support is needed to perform house improvements. And if you are overwhelmed by the costs associated with many potential home repairs, you can always walk away from a home sale at this time.
Clearly, there are many reasons to perform a home inspection before you finalize a house purchase. If you hire an expert real estate agent, you can receive plenty of support as you prepare for a home inspection too.
A real estate agent is happy to put you in touch with the top home inspectors in your area. Plus, a real estate agent will attend a home inspection with you and is ready to provide guidance throughout the evaluation. Perhaps best of all, a real estate agent can meet with you after a house inspection, go over the inspection results with you and help you make an informed decision about whether to proceed with a home purchase.
Establishing a competitive initial asking price for your house often can be difficult. Fortunately, we're here to help you determine the ideal asking price for your home, regardless of the current housing market's conditions.
Now, let's take a look at three tips to help you set the right initial asking price for your home.
1. Study the Housing Market
How does your residence stack up against the competition? Evaluate the prices of comparable houses in your city or town, and you can narrow your home price range.
Furthermore, it helps to examine the prices of recently sold residences in your area. With this housing market data, you can find out whether you're preparing to enter a buyer's or seller's market. Then, you can map out your home pricing strategy accordingly.
2. Conduct a Home Appraisal
A home appraisal offers a valuable learning tool for a home seller. It allows a seller to receive expert insights into the value of his or her residence. As a result, a seller can get a property valuation from a home appraiser and use this figure to establish a competitive home asking price.
In addition, it may be beneficial to conduct a home inspection prior to listing your house. An inspection enables you to learn about any problems that may affect your house's value. And if you choose, you can use a home inspection report to prioritize assorted home repairs that may help you boost the value of your house.
3. Collaborate with a Real Estate Agent
If you're unsure about how to price your residence, there is no need to stress. In fact, you can hire a real estate agent to receive comprehensive support at each stage of the home selling journey.
A real estate agent is happy to help you assess your house and determine the right price for it. He or she is unafraid to be honest, and as such, will offer unbiased home pricing recommendations. That way, you can establish a competitive price from day one of the home selling journey and increase the likelihood of a quick home sale.
Also, a real estate agent goes above and beyond the call of duty to assist a home seller. This housing market professional will set up home showings and open house events to showcase your residence to prospective buyers. Plus, he or she will keep you up to date about offers on your residence. A real estate agent will even negotiate with a buyer's agent on your behalf to ensure you can maximize your home sale earnings.
Perhaps best of all, a real estate agent will respond to your queries throughout the home selling journey. If you ever have home selling concerns or questions, you can simply talk to your real estate agent and receive expert support.
Take the guesswork out of pricing your residence – use the aforementioned tips, and you can set a competitive price for your home in any housing market, at any time.
Unmarried couples often find themselves surprised at the additional steps it takes to buy a home compared to their wedded friends.
This guide will help you prepare for buying a home together as an unmarried couple:
Banks will assess you differently than they would a married couple.
Whereas they look at a married couple as a single financial unit, you and your partner will be assessed individually. This certainly has its pro’s and con’s. Know that if one partner has a significantly lower credit score it can affect your eligibility for a loan as a couple.
Legal ownership of the title will be different.
Unmarried couples have three options when it comes to title ownership: sole ownership, joint tenants and tenants in common.
Tenants in common is the most popular. The difference between tenants in common and joint tenants is this:
In a joint tenancy ownership is 50/50. If one partner were to become deceased, ownership of their half of the property would carry over to the other partner.
Tenants in common ownership can be disproportionate to reflect each partners level of investment. If one partner were to become deceased, their living trust would inherit ownership of their portion of the property if another option is not otherwise specified in their will.
Sole ownership is just that. One partner owns full legal ownership of the property. This option can have tax benefits and increase your financing eligibility if one partner has a higher income or better credit score than the other.
It’s highly recommended for unmarried couples to sign a property, partnership or cohabitation agreement when buying a home together. This is a legal precaution to safeguard both partners in the future should anything happen.
If your finances are separate it is ideal to at the very least create a joint checking account from which to draw the down payment and mortgage installments. This is especially true if both partners are contributing to these payments. It create a clean, clearcut payment process each month.
Know each other's finances.
Discuss your credit scores, debt burden, savings, investments and financial goals. Get clear on where you each stand and how these factors will influence your buying process. Create a budget together as a couple to ensure you can take on not just the responsibility of a mortgage payment but also closing costs, homeowners insurance, property taxes and maintenance costs. Plan for savings like retirement, nest egg, family planning, future vacations, and emergency funds.
Buying a home together as an unmarried couple is a different process than that of married couples. However, that doesn’t mean it has to be harder. With an understanding of what to expect ahead of time and a plan in place, the process can be a smooth one.
An open house enables a buyer to check out a residence in-person and determine if this home matches or exceeds his or her expectations. However, a buyer who fails to plan ahead for an open house may struggle to make the most of this opportunity.
Ultimately, there are several things you need to consider before you attend an open house, such as:
1. Your Home Must-Haves
Make a list of must-have home features – you will be glad you did. With this list in hand, you can check out a house in-person and determine if it has the features you require.
You also may want to put together a list of preferred cities and towns prior to launching a house search. This list will allow you to hone your home search – and your search for open house events – to a small group of cities and towns.
2. Your Homebuying Budget
As a homebuyer, it is crucial to optimize your time and resources as you search for your dream residence. If you enter the housing market with a budget at your disposal, you can avoid the risk of attending an open house for a residence you may be unable to afford.
To establish a homebuying budget, you should review your current finances. You may want to meet with banks and credit unions as well. And if you get pre-approved for a mortgage, you will know exactly how much you can spend on a residence when you start your house search.
3. Your Homebuying Timeline
There is no guarantee that attending one open house will help you find your dream residence. But if you maintain flexibility, you can attend a variety of open house events and boost the likelihood of discovering a residence that falls in line with your expectations.
Furthermore, you should be ready to act quickly if you attend an open house and want to buy a residence following the event. In this scenario, you should be prepared to work diligently to put together a competitive offer to purchase the home.
As you get set to attend an open house, you may want to employ a real estate agent, too. A real estate agent can keep you up to date about open house events in cities and towns where you want to reside. Plus, a real estate agent can attend an open house with you and provide plenty of homebuying tips and insights.
Let's not forget about the support a real estate agent provides once you find a house you want to purchase, either. At this point, a real estate agent will help you put together a competitive homebuying proposal. And if your offer to purchase is accepted, a real estate agent will help you finalize your house purchase.
Consider the aforementioned factors closely before you attend an open house. By doing so, you can prepare for an open house and use the opportunity to determine if a residence is right for you.