Buying a home can be an emotional, time-consuming, and complex process. There are a few things you can do to help make the process go as smooth as possible:
1. Check your credit.
Before you apply for a home loan, regardless of your credit, it's a smart idea to obtain a copy of your credit report from the three major credit bureaus and review the information. If there are errors or things that need to be addressed, it's easier to address them before you've found a house, than after when you're trying to close your loan.
If you know there are a few blemishes on your credit, let your lender know what they are, why they are there, and why you are a still good credit risk. Lenders look at your credit to determine how likely you will pay back the loan. If you had extenuating circumstances - like a loss of a job or medical bills - let them know so they understand it's not likely to happen again in the future.
2. Get approved before you buy.
An approval means a lender has reviewed your credit history, verified your assets and employment, and has approved your loan before you've found a home to purchase. As long as the home appraises for at least the purchase price, the loan should close.
Getting approved also gives you an advantage over other buyers. This approval makes it easier for you to negotiate on the price of a home.
While getting pre-qualified may sound official, it's really just getting an idea of what you can afford. It's having a person plug in the numbers you provide - your monthly income and your monthly debt - and getting an approximate payment calculated. From the payment, the calculator can approximate the house price range you can afford. No information is verified, therefore, a pre-qualification has little value when purchasing a home.
3. Find a great buyer's agent
Traditionally real estate agents represent the sellers in a transaction. When you're not working with a buyer's agent, they are less likely to negotiate the best price or contingencies for you.
A buyer's agent's job and fiduciary responsibility (meaning legal duty) is to you, the buyer. Before working with an agent, establish if they are a buyer's agent or a seller's agent. After spending a lot of time with a Realtor, it's natural to feel like you're a team. But if they're not negotiating for you, then they're not on your team.
For the remaining 3 steps, simply download the full report and they will be emailed to you immediately!
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