HOMEBUYER: GET THAT HOME!

Homebuyers are extremely frustrated nowadays due to the shortage of inventory available to buy a home. Not only are there few properties to choose from, prices are still constantly going up. The average home values are starting to be out of reach, and throughout the country there seems to be a crisis in finding affordable homes. These are interesting times we live in.

If you’re a home buyer and you want to improve your opportunities to buy a residential property (condo, townhome, single-family, among other types) read on for a few suggestions I wish I knew back when I was purchasing my first home and knew nothing about buying real estate.

1. Find a Lender

Find a lender even before you start looking for home. I know, you’ve been swimming in the ocean of Trulia, Zillow, realtor.com and Redfin, so you kind of already have an idea of what kind of home you want, or are looking for. That’s great. But stop. Stop for a minute and search for a lender. That is of course, if you need financing. If you have all the cash in the world to buy a home forget I said anything.

2. Get Pre-Approved

So, yeah, you need financing. Talk to that lender. BEFORE you start your car to go and do the rounds of viewing homes, get with that lender (bank or mortgage broker) and get pre-approved for a loan. Why? 

1. To know how much home you can afford to buy.
2. Better chances of getting your offer accepted. 

2. Get a Real Estate Agent

As a buyer getting a real estate agent to help you buy that home. They are aware of the ins-and-outs of the real estate transaction and can guide you through the process. In Florida buyers don’t pay agent commissions, usually. Their commission comes out of the seller’s proceeds. This is not the same in all states, but ask around where you are, it pays to get an agent if you’re buying and it’s free. Remember your agent works FOR YOU. Always consult with them what’s your better choice.

3. Decide on a Lender

You found a lender and got pre-approved. Remember, all lenders are not the same, which is why you should shop around. If you’re planning to talk to your personal bank, may I also suggest you search and chat with a mortgage broker as well, so you can compare what they offer. I strongly advise this. 

If you have already been pre-approved tell them you’d like their opinion on what kinds of loans they have available for you. Ask many questions, there are government guaranteed loans (FHA, VA), Conventional loans, Downpayment Assistance, etc. Ask about mortgage insurance and when you need it, loan fees and loan terms. It is not all about the interest rate. There are many things involved in a mortgage and its value to you. People focus only on the mortgage rate, and forget other details which could make a loan cheaper or more expensive.

4. Getting your offer accepted: During and right after the Pandemic you were competing with many investors and buyers making cash offers. Of course Cash is king. Even though now investors and cash offers have tampered down a bit, you do have to improve your chances at getting an offer accepted. If you are serious about getting that home right now you will need to have been  pre-approved for a loan. No serious real estate agent would show you homes without a pre-approval letter, at least. Plus, even if you were to make an offer, without this a seller most likely ignore your offer. The catch-22 is you can’t yet apply for the loan unless you have a contract on a property. So, ahead of the game with that pre-approval letter. Those days of submitting offers stating you will get pre-approved in s a few days are long gone. Also, many buyers these days have to make an offer over asking price to get the home. Sometimes just a few thousand more than listed price will do the trick.  

There are many things to consider when buying a home. If you have time, you can find some answers here. And in Spanish, here.