Lenn Harley has epiphanies.  When she does, she shares them with us and they're really good!!

I had one the other day (Saturday, to be exact) when I received a call from a first time buyer.  While talking to the nice young man something weird happened. 

I said, "You know, getting a car loan is the EXACT OPPOSITE of getting a home loan."

And I explained:

  • A car buyer goes in to the lot.  They test drive the vehicle, like it and then they apply for a loan.  The mantra of "What can I do to get you in this car today?" is often heard. 

When buying a car, the financing is done AFTER the decision is made to buy the car.  And boy howdy, they'll find a loan for the car buyer.  No credit, low credit, crappy credit . . . NO PROBLEM!  They'll be able to finance a car loan.

NOT SO WITH HOME BUYING!

  • A home buyer goes in to the house.  They check it out, like it and then . . . if they make an offer based on the "car buying" mentality of applying for a loan AFTER they've found a home, they might not be able to close the deal.

Why?

Financing guidelines.  Plain and simple. 

  • Buyers might be looking at property they are unable to qualify for
  • The home buyers income-to-debt ratios are too close and they need to come up with more down payment in order to purchase . . . which they may not have
  • The buyer CAN qualify, but opps, someone with a pre-approval submitted an offer and the seller opted to go with the buyer who was pre-approved
  • The seller doesn't want to accept an offer which isn't backed up with the Buyer's pre-approval
  • and the other reasons buyers can get turned down for a home loan are vast and varied

It was an epiphany . . . or something like that.

If you're buying a home GET YOUR FINANCING IN PLACE BEFORE YOU GO OUT AND KICK THE TIRES!

The seller is NOT OFFERING FINANCING.  They won't be able to get you in the home today . . . unless you show them your pre-approval with your offer!

search Portland PropertiesEBA Portland ~~ 100% BUYER REPRESENTATION ~~ 100% of the Time

EBA Portland, LLC is an Exclusive Buyer Agency serving the Metro Portland real estate market since 1999. If you’re a Buyer in the Metro Portland area (including: Beaverton, Tigard, Hillsboro, Lake Oswego, Downtown Portland,) and contemplating a purchase, talk with a Buyer’s Agent . . . better yet, talk to an ExclusiveBuyers Agent. Exclusive Buyers Agents do not work for listing brokerages or Sellers. An EBA’s fiduciary dutyis: 100% BUYER REPRESENTATION . . . 100% of the Time.

 Carla Muss-Jacobs
503-810-7192
Carla@carlahomes.com 		         

BuyersAgentPortland.com

All rights reserved ©

 
This post has been included in Oregon Real Estate News Washington County, OR Real Estate News
Post is included in group: Realtors®
Post is included in group: Bartender, Make it a Double
Post is included in group: "Whacked"!!!
Post is included in group: Dedicated Bloggers
Post is included in group: BananaTude

41 Comments on What First Time Buyers Need to Know . . . Why a Car Loan is NOT The Same as a Home Loan

20 Most Recent Comments Displayed Show All

SEP
06
643,040 Points 10 Featured Posts Localism Sponsor Outside Blog

Now I know why first time home buyers are so confused. I will say the the guidelines now are way out of line compared to common sense, as they were 7 years ago. Maybe some day the community reinvestment act will get the credit it deserves for crashing the housing industry.
4:44am • #22
184,474 Points 1 Featured Post Outside Blog Called Shot Master

Hi Carla,

Good point! Buying a house is generally unlike anything a first time homebuyer has experienced.
4:47am • #23
1,441,707 Points 43 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

This is a good explanation. . .and a reminder when you are kicking the tires. . you need to have your agent present!
5:52am • #24
670,149 Points 74 Featured Posts Outside Blog Called Shot Master

I couldn't agree more Carla.  Get approved first!  Good post.                                                                                              
6:08am • #25
742,335 Points 16 Featured Posts Outside Blog Called Shot Master

Carla, you are absolutely right! Buyers do have buying a car mentality. Why, because they don't know any better. Many buyers especially first time buyers have bought cars, but not a home. They need to be educated as to the home buying process. Great Post!
6:11am • #26
269,604 Points 10 Featured Posts Outside Blog Called Shot Master

Carla- You are spot on. What a genius epiphany. What people don't consider when buying a car is they should be pre-approved before they go look at them too. Now, if I could just get a recording of your epiphany to play for my clients that don't want to be preapproved before we head out!
6:39am • #27
1 Featured Post Outside Blog Attended Rain Camp

We are experiencing an upturn in our market in Seattle and don't have enough homes for sale in certain neighborhoods. The first day of touring with clients I make sure and make mention of that. If you are up against 12 offers, 9 with pre-inspections, do you think you even stand a chance with no pre-approval letter?

Of course this is an extreme recent real life example, but multiple offers aren't rare. Working with first time home buyers means a lot of educating, but that's our jobs!

Thank you Carla for a great turn of a phrase. It clarifies a complex idea.  It's being added to my quiver!
7:00am • #28
301,008 Points 7 Featured Posts Outside Blog Attended Rain Camp

Hi Carla, nice post. Gradually it is getting better with buyers seeing a lender first. A while back this was almost unheard of. Keep getting the word out!
8:02am • #29
1,178,430 Points 87 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

Buyers especially first time buyers think that just because they pay a certain amount each month for rent, that the mortgage process is similar. Not. Buyers that don't know what their buying power may be just waste everybody's time. Good Post.
10:23am • #30
1,144,655 Points 107 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

I just had my laugh out loud moment for the day Carla.  I think I'm gonna ask next time I show a house "what can I do to get you in this house today?"  HAHAHAHAHA  This was great.

 
11:37am • #31
288,802 Points 4 Featured Posts

Great insight Carla! It's quite true. Sometimes I wonder though, whether it was just a formality to put the cart before the horse in the "Boom" years. "You're 98*? Sure, Here's money. buy whatever home you want. Knock yourself out!"
1:00pm • #32
189,501 Points Localism Sponsor Outside Blog Attended Rain Camp

A-HA!  Well said, Carla. Harder yet is to convince buyers to NOT buy the car (or really even look at anything) until after they've closed on the home.
Bruce

 
1:56pm • #33
552,656 Points 9 Featured Posts Outside Blog Called Shot Master

Carla:

If only home loans were as quick as auto loans.  Our jobs would be so much easier.  But I guess that is what go us in the mess we had to deal with for the past 4 years.
4:03pm • #34
407,881 Points 49 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

Hi Carla, Love those ephipanies (sp) ..and this one was sooooo good! Your analogy put this in perfect perspective for buyers to understand the importance of getting the loan approval BEFORE they start looking. Love it!
5:09pm • #35
152,888 Points 2 Featured Posts

A good reminder and analogy.  The home loan process is so different.
8:29pm • #36
SEP
07
539,191 Points 71 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

I have a couple of hard working mortgage brokers that will field my sign calls on the weekend. Buyers NOT willing to speak with these professionals (or supply a loan letter) don't get in the front door.
6:53am • #37
1,380,486 Points 151 Featured Posts Localism Sponsor Outside Blog Attended Rain Camp Called Shot Master

It's all fun and games until you can't buy the home of your dreams :)
4:16pm • #38
SEP
19
196,809 Points 10 Featured Posts Localism Sponsor Attended Rain Camp Called Shot Master

Yeah Carla!! That is so very true and I love the analogy.....Great Post!!
9:06pm • #39
SEP
20
435,517 Points 1 Featured Post

A lot of difference...and we are not used car salesmen either

 
8:09am • #40
MAY
17

Such a simple concept, and you communicated the comparison perfectly.
3:34am • #42

20 Most Recent Comments Displayed Show All


Captcha

Drag the man to the circle on the side.

Image?id=f800e595eb3ceec70ef321070bb247e145dfa233 Image?id=d5ed9338bdd6de4d0d153e4718d9313fa0d1ff59 Image?id=ff3a82fcce9b7d0b091b563c5b7205a6af12c12e Image?id=64e2c13bce38232759375037121ad85631203f33 Image?id=58e1bff36ae6ddc4c48696156e2f494d7bc64547

Accessibility option: listen to a question and answer it!

Type below the answer to what you hear. Numbers or words, lowercase:
Leave a response…

(optional)
Captcha

Drag the woman to the circle on the side.

Image?id=25d7273e538751f74ead749ef965b85e439c794f Image?id=4fd53fa32bab6378819065489f38d0792c162478 Image?id=a4704d301d3ad07082ddd9df5456cb23058c4382 Image?id=d034f8024241b167d99c5fe76f806a2226cb8c21 Image?id=5d9fa812bad6b62061b5cb862b071a2d8e6601c8

Accessibility option: listen to a question and answer it!

Type below the answer to what you hear. Numbers or words, lowercase:
 
Carla Muss-Jacobs - Principal Broker/ Owner | Buyers Broker | Buyers Agent EBA (503-810-7192 | BuyersAgentPortland.com) Rainmaker_large

Carla Muss-Jacobs - Principal Broker/ Owner | Buyers Broker | Buyers Agent EBA

Portland, OR

More about me…

503-810-7192 | BuyersAgentPortland.com

Address: Beaverton OR, Portland OR, Forest Heights, Lake Oswego, Hillsboro, SW Portland, SE Portland, NW Portland, N Portland, Downtown, The Pearl, NE Portland, Milwaukie, West Linn, Aloha, Cedar Hills, Portland, OR

Office Phone: (503) 810-7192

Cell Phone: (503) 810-7192

Email Me

Author Bio: Carla Muss-Jacobs is the Principal Broker/Owner of EBA Portland, LLC an Exclusive Buyer Agency representing Buyers in the Portland Metro real estate market since 1999.

The Sellers have their own agent ~~ Why don't you have yours?  

Carla Muss-Jacobs practices the TRUE FORM of Buyer Agency ~~ Exclusive Buyer Agent.  Her office/brokerage never takes listings and never respresents the Seller.  Exclusive Buyer Agency is the BEST form of legal real estate representation a Buyer can have.  There is 100% Buyer Representation - !00% of the Time.  There are NO CONFLICTS OF INTEREST and there is no possibility of ever having YOUR Buyer Agency comprised.  When buying a house -- it's important to know who is working for you!!  



Listings

Links

Archives

RSS 2.0 Feed for this blog