Before You Can Progress Towards Closing On Your Home, There Are Some Preliminary Steps

Category: Finance, Real Estate.

Home buyers, whether first or fifth time buyers, sometimes find themselves with a mortgage they can' t handle.

This doesn' t have to be the case for you, however. That situation can lead to foreclosure and a stain on their credit record. If you' re looking for a home, there are a few things you can do before you go house hunting in the Hendersonville real estate market. Making that decision before you start seriously looking around can help you in the long run. Once you' ve committed yourself to the task of purchasing a home, you need to decide on how much of a mortgage you can afford. Settling on a ballpark figure gives you and your realtor a range to work in. With a reasonable figure in mind, you need to get prequalified or preapproved for a home loan. (This will give you a more definite price regarding your home choices. ) Generally, your real estate agent will recommend a mortgage broker to get you started.

It also allows you to save time by focusing your interest on what you can afford. Getting preapproval from a lender is an intensive pursuit. The difference between being approved for a loan and qualified for a loan is fairly straight forward. However, once you have a letter from a lender, you have evidence that you' re serious about and capable of purchasing a home. For a prequalification, you supply the lender with a few basics. You' ll need to give information about your finances, such as your household income and debt load.

You can do this online or on the phone. With that information, you can get an estimate of the maximum loan you' re eligible for. They will ask you for pay stubs, credit accounts, tax records, bank statements and other relevant financial documents. To start the preapproval process, you must submit much more specific information. After an extensive analysis, you will receive a figure based on your ability to make reasonable payments. Generally, realtors in the Hendersonville real estate market can direct you to a mortgage broker they are both familiar and comfortable with.

Because the figure is based directly on your finances, agents and sellers are more confident in completing a successful transaction with you. You may elect not to use the recommended lender. First, know your loan options. You should have several questions lined up for your financing prospects, in this case. You can ask what kind of financing programs they offer. They are financial professionals, after all.

Don' t be afraid to ask which one they think suits your situation. The market waits for no one. Feel free to ask them how long the approval process takes. The last thing you want is to miss your opportunity because you' re waiting on funds. Some institutions offer flexible plans while others adhere to much stricter terms. Remember, this will be a long- term commitment.

Ask which line items are negotiable and/ or if the agreement itself is at all negotiable. Make the most of your arrangements now, before you' re locked in. Find out what the financier's policy is regarding locked in rates. Understanding interest rates is also a necessity. Also, ask about future interest rates, particularly the policy if the rate decreases during the lock- in period. You don' t want to incur any unnecessary expenses or penalties on your loan.

Finally, you need to know if they charge fees for prepaying on your loan. Before you can progress towards closing on your home, there are some preliminary steps. Going in prepared makes everything much easier. As you' re checking Hendersonville real estate for the home of your dreams, be certain you know how much house you can afford.