Hello ladies! I am back from a much needed weekend with my family and future in laws and I apologize for not bringing my laptop with me to give you a tip for Saturday and Sunday! However I'm hoping you had a nice weekend as well, and although today is holiday - it's back to business for me!
Happy Columbus Day!
Tip #2: Make A Plan And Get Pre-Qualified
Every important decision needs to be clearly thought out. From investing in a pair of expensive shoes to starting a new job or career and buying a home!
Developing a home buying plan can help you focus on the important factors and organize the entire process. It's a great idea to purchase a binder with sections on house hunting, home financing, service providers, etc. (More on service providers in the future).
Loan pre-qualifying helps you determine the home price you can afford and presents you as a genuine prospect to the seller. In most cases today, you will not be able to submit an offer without a prequalification letter, and some real estate agents require that you bring your letter during your first buyer consultation.
A lender typically uses the 28% formula (your monthly mortgage can't exceed 28% of your monthly income) in approving your loan. Planning your actions and getting pre-qualified will keep you out of the panic mode and allow you to take advantage of opportunities. Plus you will be able to make an informed decision instead of acting on pure emotion. Buying a home can be exciting! Especially if you see a place that has everything you want..
A thorough plan will save both time and money!
Remember, a prequalification letter does not commit you to working with that particular lender or broker. And the same is true the other way around. Just because a bank or broker provided you with a prequalification letter it does not guarantee that they will approve you for that amount or even approve you at all. Many things can change while you're shopping for a home including lending restrictions and not to mention your credit! It's important that during the process you keep tabs on your spending and on your bills. Make sure to pay everything on time, and hold off on major purchases until after you've bought your home.
Till tomorrow!
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