• HS_Realtor

Buying a Home...Are you ready??

Things to consider before contacting an Agent about purchasing a home



1. CREDIT SCORE


Do you know your credit score??


Plain and simple, if you don't have CASH, you need financing, and you will NOT QUALIFY for a mortgage unless your credit score meets the minimum requirement. Here in MN, you need at least a 620. However, I have seen some loans go through with a score as low as 590. Every situation is different and that brings me to my next qualification...


2. GET PRE-APPROVED


First thing is to notice that I did not say get PRE-Qualified. There is a difference. A pre-qualification just means that someone has pre-qualified you for a loan, its pretty simple and usually the first step. It doesn't matter in the Real Estate world. You need to get Pre-Approved. If you get Pre-Approved that means that the lender is fairly certain they can get you a mortgage based on certain variables.


If you do not know a lender, you can always call an Agent and ask them to refer you to a great lender, we have worked with many and we can recommend someone for you. However, if you get pre-approved before you contact an Agent to help find you a home, it speeds up the process and we can start showing you homes right away.


Some things you will need to have in order to get approved include:


  • Tax Returns

  • Pay Stubs

  • Bank Statements

  • Prior Address (5-7yrs back)

  • 401(k) statement


Most Agents out there will not show buyers homes at all if they are not pre-approved. That is nothing but a waste of everyone's time. Especially in this market... if you are not pre-approved you will not be able to submit an offer... and in the market today, you need to be able to move quickly when you find a home you want.


3. HOW MUCH CAN YOU AFFORD??


It is very important to figure out what payment you are comfortable with.


A lot of times, you will be pre-approved up to a certain amount however you might not be comfortable with paying that top payment amount. Buying a home is the biggest expense you may ever make, you don't want to stretch yourself tight.


There are many variables in how much a house payment will be. Things like taxes, interest rates, HOA's and Insurance may all play a factor in determining what your exact loan amount will be, but if you have a good idea ahead of time on what you can afford for a payment, we can work around that to find the perfect home for you.


For example: You may be able to afford a home for $250,000 in one town and able to afford a home for $300k in another town for the same monthly mortgage payment amount. Crazy how different every community is.


4. DO YOUR RESEARCH


Look at other homes for sale in the areas you are interested in, get a feel for what the average taxes are, get to know what that community might offer and look at the homes in that area.


Do you know what type of home you are wanting?? Do you know the different types of homes and their differences?? Are you familiar with the different types of homes and how they make a difference on the costs??


For example: A rambler (ranch) home will usually be more expensive then a split level home- do you know why??? That's why you need to do the research. Some homes cost more. Its all about the foundation size.


Ramblers are one-level and typically have the biggest 'footprint' when it comes to foundations. Split level homes do not have as deep of a foundation so that means they are slightly cheaper to construct.


You should also figure out what kind of home you are wanting, SOG (Slab-on-grade) are going to be your cheapest because they don't have a foundation at all, meaning no basement. Then you have crawl space, partial basement and full basement. Lots of different homes out there.


Different things to consider is all. Just make sure you know what kind of homes are typical in the area you are wanting and notice how the different foundations impact the price.



5. You're ready! Give me a call today and lets look at some houses!


If you have any questions on anything in this blog including the different home types and foundations, or anything pertaining to Real Estate, make sure to leave a comment or email and I will get back to you right away!


I am always happy to help!


As always, thanks for reading and make sure to Subscribe to my blog and follow me on Facebook, Instagram and Twitter


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