What is the first step? Do you hop on the internet and start looking at homes? Do you call an agent and start viewing homes? Do you get in your car and start driving around looking for homes? Wrong, Wrong, Wrong!
In most cases, the first thing a person wants to do when they make the decision to buy a home is start looking at homes! Of course, this is a step in the buying process, But the First? Not by a long shot! The first thing that you should do is sit down with the lender of your choice and get your finances in order and obtain a pre-approval letter. A pre-approval letter is a good faith note from the lender, re-assuring that you do in fact have the means to buy a property for a certain amount.
Buying a home is not like buying any other product out there! Some people compare it to the car buying experience, where you can go pick out your car, and within an hour, be approved for a loan. These are totally different processes. Over the past decade, there have been many new restrictions put on loans that have made the approval process more in depth. The loan to debt ratio, credit score, and terms of loans have changed. Has this made the pre-approval process harder? In short no. What it has done is made it to where people in general do not buy outside of their means; which creates a safer more stable housing market.
Getting the pre-approval letter not only lets the buyer know exactly what their budget is, but it is mandatory when writing an offer on a property. To be taken seriously when writing an offer, the seller wants to see that you have the means to follow through with the purchase. There is nothing worse than finding your dream home, and shortly after, the home falls under contract while you are securing financing!
When deciding to buy a home, take the first step. Obtain a pre-approval letter. This will give you confidence when viewing homes because you know your budget. It also gives you the opportunity to take action when you find that dream home before someone else buys it!
If you have any questions regarding financing, I would be more than happy to point you in the right direction and supply a list of lenders I have personal experience with, that will get the job done!
I'm busy working on my blog posts. Watch this space!