Archive for the ‘buying process’ Category

Home Buying Process and Mortgage Loans done correctly.

Sunday, May 11th, 2008

The home buying process can become the biggest nightmare if not done correctly. I am sure you have heard of all the stories out there about somebody’s loan not going smooth and what a humiliating experience that can be. Since buying a home is the single biggest purchase you will ever make, you need to make sure the process you are giving is the correct one. Since most of us are emotional buyers, and would like to go look at homes before getting a loan in place, this might seem like to best process to follow. I will be the first to tell you, that if you go look at homes before you get a mortgage loan in place, you very well could be part of the nightmare mentioned. Take our advice and remember this.

Get approved for a mortgage loan
Most people like to lead the cart before the horse, only because it seems easier. Unfortunately that is not the process when buying a home. The first step is to get a mortgage loan secured. The reason for this is anything can go wrong when buying a house if you don’t dot your I’s and cross your T’s. It probably sounds like more fun to run out and look at a bunch of homes, before getting you’re financing in place. With all the current tightening up in the mortgage industry, and your credit score needing to be higher these days, you cannot afford to assume you will be able to get financing. The lending requirements are a lot stricter these days. Let’s assume you go out and find the home of your dreams, but you have not idea what you qualify for. Nor do you have any idea what your payment would be on the homes you are looking at. Here is a list of situations that could happen if you don’t get pre-approved before looking at homes. Also if you know you have good credit, you still may get denied, so don’t assume anything.

1. Find a home only to get let down because you don’t qualify for it.
2. Thought the payment would be lower.
3. Need money for down payment you don’t have.
4. Got something on your credit report you knew nothing about.
5. Your credit scores are too low for your type of loan scenario.
6. Someone has stolen your identity and you just found out.

7. You don’t have enough credit to get a mortgage loan

This is just some key problems that could take place if you don’t get your pre-approval first. If you go out and write a contract up on a home, and find out later you cannot secure financing you have wasted your time and everyone involved. Plus it could cost you your earnest money which could be between $500 and $1000 dollars.

Get a seasoned realtor to help with your search
After you are pre-approved for a mortgage loan, you need a highly qualified realtor. You don’t want to work with a realtor that runs you out to look at homes before you meet with a lender. If a realtor does this, you are going to have problems. I promise. Most seasoned realtors will not allow you in their car until you are approved with a reputable mortgage lender. This may not sound like the process you want to follow, but it the only way to get matters rolling and it’s the correct way.

Whether you have thought about buying, or maybe you were just denied for a mortgage, what every your situation is, most people are pulling a copy of their-credit report to get an idea where they stand with their credit. Don’t take the easy way out, because it will make matters hard for you.

Disclaimer: This information has been compiled and provided by as an informational service to the public. While our goal is to provide information that will help consumers to manage their credit and debt, this information should not be considered legal advice. Such advice must be specific to the various circumstances of each person's situation, and the general information provided on these pages should not be used as a substitute for the advice of competent legal counsel.