The benefits of a preapproval (not prequalification) for home loans in Houston Texas
Many consumers are not educated on the proper way to go about buying a home. This can be extremely stressful or enjoyable depending on how you choose to go about the home buying process for homes in Houston TX and surrounding areas. You must take the steps necessary to educate yourself on your buying power, take some time to think about your lifestyle choices, and the initial investment. This article will cover all of these.
Education
The proper way to go about buying a home in Houston, Texas begins with getting preapproved for your home loan. Notice we did not say get prequalified- in today’s world a prequalification is not meaningful. You should choose a mortgage lender that offers you no cost home buyer counseling and pre-approvals. During this process, you will supply two years tax returns, one month’s full paystubs, and two months of all your liquid assets accounts statements- Checking, savings, stock accounts, 401K, IRA’s are all examples of your liquid asset accounts and an authorization for the mortgage banker to pull your credit report. You will need to provide all pages of the bank statements, explain and prove where the money for deposits came from that was deposited into your liquid asset accounts. Your mortgage banker needs to analyze the date to establish: 1. How much home you can afford. 2. The type of loan structure and initial investment that best fits your needs and 3. What type of house payment you feel comfortable paying for and qualify for.
Initial Investment
Numerous types of loan programs are available in the mortgage industry that range from Conventional loans with 5% down payment options to FHA loans with a 3.5% down payment as well as 100% financing on VA and USDA loans. You should have your mortgage lender calculate the remaining part of your initial investment, your taxes and insurance, what your closing costs are and whether or not there are any seller or lender contributions. This is one reason why you should consult with an experienced mortgage professional that can help you decide what the best loan program is for that fits your needs.
You will know what price range you should start looking in with comfort after you get pre-approved and you have your mortgage counseling session. This will give you a "head start" on your home loans in Houston Texas and the surrounding area that gives you the "buying power of a cash buyer". After you submit your offer, have your mortgage banker send a pre-approval letter that matches your offer to let the seller know that you are cleared to be pre-approved for inspections, for title work to come back clean, and to get an appraisal. You won't have much stress wondering if you qualify, if something comes up on your credit report causing a delay or for you to be turned down from that loan.
For more information on a mortgage pre-approval for your home loan, visit the U.S. Bank National Association website @: https://www.usbank.com/mortgage/pre-qualification-pre-approval.html
Lifestyle Choices
You can't underestimate your full budget amount for your house payment and all of the other monthly obligations. You have numerous options. For those whose income is projected to increase (like a younger professional getting started in their career), you may elect to buy at the upper end of your qualifying range in terms of house purchase knowing more discretionary income is on the way. If you know that your income is going to be flat, you will be choosing the level of discretionary income you would want to use to reserve it for new cars, traveling, eating out,money for furnishing and updating your home, etc. It is important to seriously consider what final purchase price you are comfortable with to enhance your lifestyle after purchasing your home.
Our team is standing by to assist you with your Home Loans in Houston Texas. CALL US TODAY!!!!
Register to our Online Home Buyer Workshop "20 Things You Must Know Before Buying a Home"! Click HERE
Richard Smith
Branch Manager/Mortgage Banker NMLS #220593
The Richard Smith Team| 22503 Katy Freeway Suite 27, 77450
Office 281-994-4240 | Cell
832-887-1300 | Fax
281-840-6881
Comments(0)