Getting pre-approved for a home loan is the first step
If you’ve bought, sold, or are considering buying a home, you know there are a lot of moving parts to the deal. Whether you are buying your first or your fifth home, a good real estate agent will always make sure to ask you one thing: are you pre-approved?
First step in buying a home: get pre-approved
Before you even take the first step in that potential new home, you should get pre-approved from an approved lender. Pre-approval ensures that a real estate agent will not present a potential home that is outside your price range. There is no worse feeling as a buyer to visit a beautiful home and fall in love with the property, only to find out later that you are unable to buy it.
There are many financial warnings that lenders can prepare you for before you consider buying a new home. These can range from finding red flags on your credit that you may not be aware of to resolving a collection issue. Or maybe one of your jobs doesn’t qualify for your credit, which could make you think you’re financially ready to buy a house at a certain price, but not on paper. This is very common in Las Vegas with our tip economy.
So how do you determine who should be your lender? There are a lot of moving parts to buying a home, especially if you are a new home buyer. An important part is determining your mortgage lender, which can be tricky if you don’t know where or how to start looking. My advice? Use your real estate agent’s lender, and here’s why.
■ Trust your real estate agent
When looking for your real estate agent, many often choose to work with someone they know and trust. Much like the real estate industry, the mortgage industry is a reputation-based industry. The same goes for the real estate agent, most of whom wouldn’t compromise their own reputation by referring a lender they don’t absolutely trust.
■ You don’t need to know what you don’t already know.
The home buying process has many steps that buyers completely ignore, and for good reason: you don’t need to know them. The professionals you hire should take over 99% of the process without needing to get involved in the conversation. When using a Realtor’s Preferred Lender, these two entities, along with the title company, should be able to easily communicate and submit filings, inspections, and other reports throughout the closing process. a month without you.
If you choose to use a lender who is not a preferred lender of your realtor, the entities often rarely speak to each other. Instead, many homebuyers may be bombarded with phone calls and emails during work hours or from home, asking them to call one of the other entities to confirm details or send. updated information. The buyer ends up getting involved in the majority of the paperwork that they should never have to worry about, and the process can range from easy and fun to stressful and overwhelming.
■ What if your real estate agent doesn’t have a preferred lender?
Sometimes a real estate agent doesn’t have a preferred lender to recommend. When this happens, it is best to ask their broker’s preferred lender first. Most brokers will have a preferred lender to offer to clients, which can always be ideal for building a relationship between your real estate agent and your mortgage lender.
Another method is to refer to services such as Zillow for lender reviews. The review system is easy to navigate and is usually full of reliable information from previous home buyers who have used the lender. Most homebuyers don’t hold back in their comments. You’ll see the good, the bad, and the ugly, so checking out these websites is a great way to get reliable feedback from potential lenders.
■ Look at the quality, not the interest rates.
Low interest rates are one of the first things homebuyers turn to when looking for a mortgage lender. But it’s important to remember that you always get what you pay for when it comes to lenders. If you wanted cheaper rates, the quality of the business, communication, and the overall experience will likely be below par.
The lending industry is what I would call a ‘get what you pay for’ business. There are companies online that offer lower rates, but you just become another faceless account. Communication is unlikely to be personalized and deadlines can often be missed which can cause buyers to pay more along the way. So save yourself the heartache and find a lender who is highly rated among old customers rather than the ones with the cheapest interest rates.
Caitlin Turkovich is the Regional Manager for Union Home Mortgage – Team Turkovich in Las Vegas and Fort Bragg, North Carolina. A veteran of the US Army, Turkovich specializes in VA loans. For more information, visit teamturkovich.com.