Obtaining Financing

Here are a few tips for dealing with the dollar signs so that you can be a strong buyer in this competitive market.

Get pre-approved. Most buyers start their home search online. When looking at properties, you’ll find yourself liking many homes that are out of your financial comfort zone. By getting pre-approved as a buyer, you can save yourself the heartache of looking at houses you can’t or don’t want to afford. You can also put yourself in a better position to make a serious offer when you do find the right house. Unlike pre-qualification, which is based on a cursory review of your finances, pre-approval from a lender is based on your actual income, debt and credit history. By doing a thorough analysis of your actual spending power, you’ll be less likely to get in over your head.

Choose your mortgage carefully. Used to be the emphasis when it came to mortgages was on paying them off as soon as possible. Today, the debt the average person will accumulate due to credit cards, student loans, etc. means it’s sometimes better to opt for the 30-year mortgage instead of the 15-year. This way, you have a lower monthly payment, with the option of paying an additional principal when money is good. Additionally, when picking a mortgage, you usually have the option of paying additional points (a portion of the interest that you pay at closing) in exchange for a lower interest rate. If you plan to stay in the house for a long time—and given the current real estate market, you should—taking the points will save you money.

Do your homework before bidding. Before you make an offer on a home, we will do research on the sales trends of similar homes in the neighborhood and together we will come up with a strategy to get you the house.

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