First Time Homebuyer Series -- FHA - Conventional - VA - Subprime -- Part 1 of 5
Thanks, Jeff, for explaining this in a way we can all understand! No mumbo-jumbo-jargon here...
FYI - (these tips in this first time homebuyers series are not just for newbies/first time homebuyers)
Reality.... Buying your first home can be intense, but still can be FUN with the right people. There are many professionals out there that are willing and able to help you with this process. But the more that you understand this process, the easier and more comforting this experience will be remembered with pleasant memories.
You first need to align yourself with a good loan officer and real estate agent so as not to get led down the wrong path. I am not here to SCARE YOU, but I am not here to paint a pretty picture and just tell you to trust anyone that says "I promise" or "don't worry". These are commonly used terms in the mortgage and real estate industry. Randy Prothero talks about more amateur Real Estate Experts than ever before.
In this 5 part series, I am going to give you advice, my opinions, and my expertise as a loan officer with over 16 years of experience just in the mortgage industry.
One piece of advice is that this can sometimes take time. It's not like shopping for clothes, furniture, or even picking out a car for that matter of fact. Sure, I could get you approved for a mortgage in 1 week. You shouldn't be waiting last minute to do that though. My concern is don't buy a house just because you need to be out by a certain date. And DON'T wait with 2 months left before your rent lease is up. I am starting to see this as a problem as of lately. Just because there are a lot of homes on the market, doesn't mean that you have a better chance of finding your dream home. Talk to a realtor that knows the area well. Don't forget, there are other buyers out there also, looking for the same. Meaning..... more people will bid on the better homes out there, with multiple offers. That is why getting not only pre-qualified for a mortgage is important, but possibly Pre-Approved (knowing the difference).
On a more serious note, especially now, rates can move on you at any given time as quickly as a hot air balloon can go up. You need to be working with a professional loan officer that understands the market, rates, and regards to rising rates and why. Getting good advice to when you should lock in your interest rate can go a long way. If dealing with an application taker, it could cost you thousands of dollars.
Watching the market is especially important if you already have contracts on a home. I locked in a few of my clients last week because I do keep an eye on the bond market daily. But if you are still shopping for a home, that lender won't be able to lock you into a rate until you actually find a home. You want a trusted loan officer that is on top of this and giving you updates and not waiting until the last minute. And keep in mind when shopping for a mortgage, don't always focus on Rate. Payment is just as crucial.
Lastly, even if you are just starting out, start saving a little here and a little there. Sure, there are so many mortgage financing options out there with even 100% financing programs. There 100% programs like the USDA rural housing program or like VA loans. But each program is different. Word of advice, speak to someone qualified and not just fatherly advise even though he may mean well. Or those that just bought a home, your neighbors, or even co-workers. As mentioned above, rates and programs can change daily.
And when speaking to a loan officer, if they are quick to pre-qualify you, this could be a red flag. Please read Purchase Price vs Payment. What's missing? And don't fall into the trap of hearing negative rumors that certain mortgages are bad. Example, I hear from certain realtors and loan officers that FHA loans are a bad type of mortgage. Not true for many reasons, which will be talked about later.
Conclusion : In Part 2, I'll talk about more specifics when it comes to getting pre-qualified and pre-approved. What to look for, how to find those professionals, and how to be better prepared.
Please click all links because each link is related to this topic and will share more secrets and give you a much better outlook in regards to purchasing your new dream home.
Photos : All pictures curtesy of istockphoto
The First Time Homebuyer Series :
Understanding if you should rent or buy :
- First Time Homebuyer Tips : Summary - Red Flags to be aware of -- Part 5 of 5
Buying Tips :
- FHA 203-k Loans
- Asbestos and Your Health, Tips for Remodeling your Ann Arbor Home -- This post does talk about some specific places in Michigan, but in general, Missy Caulk gives us some great information on homes built prior to 1980 in regards to asbestos. This is a must read.
- FHA Loans - USDA Loans - Conventional Loans - VA Loans -
Experience & Knowledge at its BEST !!!
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For more information on FHA loans, please go to this link. The FHA Expert
For more information on how you can obtain your dream home, please click here : Mortgage Financing Options
For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags !!!!!
Copyright © 2008 by Jeff Belonger
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