First Time Homebuyer Tips -- Understanding your credit & Being Qualified -- Part 2 of 4

Preparation is usually the key for most things in life. Being successful at it doesn't always happen overnight. Buying a home is usually the biggest investment is one person's lifetime. So, should you be scared? Can the process be intense? Sure, there are going to be certain emotions involved and maybe more so if buying with someone else. But it will also be FUN, especially with the correct education in the home buying process and surrounding yourself with easy to work with professionals in both real estate and mortgages. Key Tip : ENJOY it and treasure it for life. Your memories will last forever. Find a keep sake or two for a scrap book.

Shopping for a home : how and where to begin...... ????

• Ask family or friends for someone trusted.
• If you are currently working with a realtor, they should know one or two trusted loan officer's in the mortgage industry.
   
• Online, the internet. Now, this can be dangerous at times. But how about reading blogs of a few professionals, to get an idea about what they offer and their services. Instead of those that advertise low rates, which anyone can do.
• If you bought a home once before and were very happy with your previous loan officer, go back to what made you happy. Who you trusted and who you had success with. (sure, this is for 1st time buyers, but maybe you bought many years ago. Maybe your significant other once owned a home.)

There are other avenues in regards to where you can find lenders and realtors. And understanding the process behind the scene, what to expect from a lender, and how to proceed can and are very crucial when it comes to buying a home.

Credit : There are so many misconceptions of what a pre-qualification letter and a pre-approval letter is in regards to when speaking with a loan officer. There is a big difference. For specifics, please read : The difference between a Pre-Approval and a Pre-Qualification letter.

Understand Your Credit : Many lenders buy lists from the credit agencies so they can solicit new business, especially from those that just had their credit viewed in the last month. Meaning, if you just spoke to a loan officer that you gave permission to pull your credit, you might be getting calls from other lenders, whom you didn't even inquire about. What can be done?

• Don't keep shopping. Many inquiries over a certain time could hurt your credit rating. If you feel comfortable with one person, why risk shopping with others that will over promise and under deliver. You could shop yourself out of the market. The bottom line is that we all get the money from the same place. Usually when someone has a better rate or no costs outside the average, if you have been shopping, then it's usually too good to be true.
• Trigger lists -- Each lender should include in their loan application package a form that allows you to "opt out", not allowing that lender to sell your personal information. You can also go to this web site for more information : www.optoutprescreen.com
• Know how your credit score is calculated and how you could improve your credit score. This is something that I can help you with, because of my 14 years of experience in the mortgage industry. Don't let other lenders make it seem that it's all about your credit score also. There is more to it than just your credit score.

Overall, don't get overwhelmed with all of the information provided. Again, that is why there are professionals out there to help you. Just be careful because there are so many that are just sales people. If you can sense that someone is not only helpful but very passionate in what they do, this might be your best avenue or resource in receiving the best advice and service when obtaining a mortgage.

TIP : Don't be afraid to ask questions. In my opinion, a bad question is a question not asked. Allow for some time for this individual to ask the appropriate questions. It shouldn't matter if it is done in person or even on the phone. The main concern is allowing about 20-30 minutes so they can do their job correctly. And this is just for the basics. My biggest help in helping you is knowing your GOALS. And be honest and upfront with the information that you supply, no matter what the situation might be.

First Time Homebuyer's Series :

• First Time Homebuyer Tips -- FHA - Conventional - VA - Subprime -- Part 1 of 4

• First Time Homebuyer Tips -- Understanding your credit & Being Qualified -- Part 2 of 4

• FHA, is this the best mortgage program? -- First Time Homebuyer Tips -- Best Programs & Why -- Part 3 of 4

Comments

[Robert D. Ashby, CMPS]

Jeff,

The series that you are working on, this being Part 2, is one that will be very beneficial to all homebuyers, especially first timers.

Keep up the good owrk and information.

[Jeff Belonger]

Robert....

Thanks for your feedback and for the compliment.

Being qualified and not assuming is key. But also finding a loan officer that brings value to the table and not just someone willing to give you a price. Someone that will look at your financing from different angles.