Archive for July, 2014

Orange County Real Estate & Loans – Make it EASY!

Posted on July 24, 2014. Filed under: First Time Buyer help, Lenders & Loan info, Orange County Real Estate |

Today I’m in a lunch & learn with Ryan Grant and the iMortgage team, and we’re talking about ways to make homebuyer’s lives easier!  There’s a lot of little (and big) steps in the process of buying a home, and if they aren’t taken in the right order it can lead to major headaches. Today’s post will focus on the loan aspect – crucial info here!!!

• Have you ever walked into an open house before, loved it, and then lost it because you weren’t prequalified?
• Have you ever given a lender your financial info verbally, they told you you’re approved for 500K, and then later found out that number was really 400K?
• Have you ever been told by a Realtor that they won’t show you homes because you aren’t approved?

Not-so-fun FACT:  36% of all real estate transactions are delayed or do not close due to lack of funding!

These things happen all the time, and the headache can be avoided by taking the right steps on the path.  Let’s just pave it for you here:

1. You MUST be pre-approved before you go out shopping.  Buyers who think ‘Oh, I’ll just do that once I find the house I like’ are setting themselves up for heartbreak.  The house you liked today, another buyer liked yesterday.   You are TOO LATE if you wait to prequalify once you find the house you like.  The market, nor the seller, nor the listing agent will not wait for you to bring your paperwork together.  If a Realtor insists that you provide them with a prequalification and proof of down payment funds before you start searching, that’s a GOOD agent who wants you to have a pleasant experience.  They know how to best serve you and make sure no time is wasted.  Only newbies let you go shopping without your *wallet*.
2. Verbal prequalifications are not enough.  A pre-approval is stronger than a prequalifcation….and listing agents know this.  If you submit a prequal while the other buyers submit a pre-approval – you lose.  If you just prequal and do not give the lender your paperwork and financial information, then you may be able to secure the escrow, but it’s possible you won’t be able to close it.  This happens ALL THE TIME in our industry, so don’t think it can’t happen to you, too.
3. Know your loan parameters.  Buying for the first time?  Great!  It’s very likely you’ll be doing an FHA loan with 3.5% down.  Buuuut, not all communities are ‘approved’ for FHA financing.  Here in Orange County, only around 50% of condo communities are open to FHA financing, so your options will be limited.  The same applies for VA loans – not all communities are approved.  If you aren’t aware of your loan limitations, you can also run into major disappointments and discouragement.
4. Structure your offer accordingly.  Tight on cash?  Tell your Realtor, and we can write in your closing costs to be paid by the seller side.  Competing with multiple offers?  Write an aggressive timeline to be more competitive.  Does the seller need to find another home?  Offer them a rentback and be flexible on your timeline.   The way your offer is structured is very important to
5. Show buying power & strength.  Part of this is your pre-approval.  Have your lender push it through underwriting so the process is almost done.  If you take the extra week or two to do this, you will appear almost as a CASH offer.  The other part is your proof of funds.  If you have more $$ saved than you are putting down, go ahead and show it to the seller.  The more funds you have, the more likely they are to feel comfortable with you!
6. Be prepared to cross-qualify.  What the heck is that?  It’s basically the process of one lender confirming another lender’s paperwork.  When you buy a home you’re in a financial fish bowl.  If you resist the seller’s request to have you ‘double’ or ‘cross’ qualify, what does that say about your confidence in being able to close the deal???  You appear stubborn, or you appear to be hiding something.  Would you want to work with someone like that?  Don’t be that guy.

If you follow the above 6 steps and work with a competent lender & Realtor, you will have the best possible experience with all financing aspects of buying your new home.  If you don’t, get ready to ride the roller coaster because you’re in for some ups, downs, and possibly flips.

More questions?  Just AskAngie!  Call 877-230-3211, tweet @AngieWeeks or comment here!