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The Critical First Step To Buying A Home
By Michael
June 27, 2017

Pre-Approval Should Always Be Your First Step | Simplifying The Market

Pre-Approval Should Always Be Your First Step

In many markets across the country, the number of buyers searching for their dream homes greatly outnumbers the amount of homes for sale. This has led to a competitive marketplace where buyers often need to stand out. One way to show you are serious about buying your dream home is to get pre-qualified or pre-approved for a mortgage before starting your search.

Even if you are in a market that is not as competitive, knowing your budget will give you the confidence of knowing if your dream home is within your reach.

Freddie Mac lays out the advantages of pre-approval in the My Home section of their website:

“It’s highly recommended that you work with your lender to get pre-approved before you begin house hunting. Pre-approval will tell you how much home you can afford and can help you move faster, and with greater confidence, in competitive markets.”

One of the many advantages of working with a local real estate professional is that many have relationships with lenders who will be able to help you with this process. Once you have selected a lender, you will need to fill out their loan application and provide them with important information regarding “your credit, debt, work history, down payment and residential history.” 

Freddie Mac describes the 4 Cs that help determine the amount you will be qualified to borrow:

  1. Capacity: Your current and future ability to make your payments
  2. Capital or cash reserves: The money, savings, and investments you have that can be sold quickly for cash
  3. Collateral: The home, or type of home, that you would like to purchase
  4. Credit: Your history of paying bills and other debts on time

Getting pre-approved is one of many steps that will show home sellers that you are serious about buying, and it often helps speed up the process once your offer has been accepted. In the competitive market today with more buyers than homes for sale, many sellers will not even consider an offer without either pre-approval from a lender or the ability to prove you have the cash on hand to buy.

There are a variety of loan products available to fit everyone from the first-time buyer with limited capital or cash reserves to invest up front to the more financially established buyer who can invest more up front for lower interest rates and better terms.   Some lenders have programs that are much easier for self-employed persons to get, compared to traditional banks.  A professional REALTOR® can steer you toward lenders who offer products most favorable to your situation and review loan offers to help you determine which is most advantageous to you.

Many lenders are now doing up-front credit underwriting.  This means that potential buyers can have the entire individual credit review process done first.  Once it's complete the buyer knows they have qualified for a mortgage of a given amount and all that remains is to 1.Locate a home in that price range and have an offer accepted then 2. Have the lender complete the property appraisal to verify that the property has sufficient value to act as collateral for the loan!   If the buyer has already completed the underwriting process, the time needed from contract acceptance to closing is reduced.

Bottom Line

Many potential home buyers overestimate the down payment and credit scores needed to qualify for a mortgage today. If you are ready and willing to buy, you may be pleasantly surprised at your ability to do so as well.  And getting a pre-approve (preferably with underwriting done up front) can reduce your stress, speed up the process and make your offer more attractive to the seller!    

 

 
What Would You Sacrifice to Save For Your Next Home? [INFOGRAPHIC]
By Michael
June 2, 2017

What Would You Sacrifice to Save For Your Next Home? [INFOGRAPHIC]

What Would You Sacrifice to Save For Your Next Home? [INFOGRAPHIC] | Simplifying The Market

 

Some Highlights:

  • 95% of first-time homebuyers are willing to sacrifice to make homeownership a reality.
  • The top item that buyers sacrifice is new clothes, at 54%.
  • Even repeat or experienced buyers say they sacrificed taking a vacation or buying a new car to buy their last home.
Buying this Spring? Be Prepared for Bidding Wars
By Michael
April 5, 2017

Buying this Spring? Be Prepared for Bidding Wars | Simplifying The Market

Traditionally, spring is the busiest season for real estate. Buyers come out in force and homeowners list their houses for sale hoping to capitalize on buyer activity. This year will be no different!

 

Buyers have already been out in force looking for their dream homes and more are on their way, but the challenge is that the inventory of homes for sale has not kept up with demand, which has lead to A LOT of competition for the homes that are available.

A recent Bloomberg article touched on the current market conditions:

“It’s the 2017 U.S. spring home-selling season, and listings are scarcer than they’ve ever been. Bidding wars common in perennially hot markets like the San Francisco Bay area, Denver and Boston are now also prevalent in the once slow-and-steady heartland, sending prices higher and sparking desperation among buyers across the country.”

Sam Khater, Deputy Chief Economist at CoreLogic went on to explain why buyers are flocking to the market in big numbers:

“In today’s market, many buyers think the trough in [interest] rates is over. If you don’t get in now, it’s just going to be worse later. Rates will be higher, prices will be higher, and maybe inventory selection will be lower.”

In some markets, “thirty-five percent of properties are selling within the first week or two of hitting the market.” Homes are selling at a rapid clip in places like:

  • Fort Worth, TX
  • Watauga, TX
  • North Richland Hills, TX
  • Hurst, TX
  • Saginaw, TX
  • Denver, CO
  • Seattle, WA
  • Oakland, CA
  • Grand Rapids, MI
  • Boise, ID
  • Madison, WI
  • Omaha, NE

Bottom Line

Let’s get together to discuss your exact market conditions and help you create a strategy to secure your new home in this competitive atmosphere! 

HUD Foreclosure Homes
By Michael
March 17, 2017

HUD Foreclosure properties can be a good investment for someone looking for a home. But it's important to work with someone who can help you determine the condition and value of the property. This is three bedroom home in a nice area of Watauga has a list price of just $116,000, Call me and I tell you how to bid on a HUD Foreclosed Home.

Spring Home Buyers Gude
By Michael
March 1, 2017

Spring is the peak buying season in Fort Worth, Keller, Saginaw, Roanoke, Watauga and all of the North Texas Marketplace.   With competition the competition among buyers, it's important that you know the most effective ways to shop for a home and and how to make an offer that will get accepted!   You'll find good information to get you started in my Spring Home Buyer's Guide.   You can download it here!   BuyingaHomeSpring2017.pdf