So you’ve started to look for a home. Great!! I’m all for this!
But how are you actually going to pay for that home when you find it? Well, chances are a bank is going to have to lend you that money. And they just don’t hand loans out like they do those little suckers.
So you need to go get pre-approved.
Why get Pre-Approved?
It really boils down to 3 simple points:
1) You’ll know what you CAN afford and what you CAN’T afford, helping focus your home search.
2) Sellers will take your offer seriously! And truthfully, most sellers request pre-approval with any offer now anyway.
3) You’ll be signally to your real estate agent you are a serious buyer and ready to go.
Do you notice a theme? Its the first step in the home buying process because its a serious step. Anyone can say they want to buy a home, but to go get pre-approved means you are GOING to buy a home.
How do I get Pre-Approved?
Truthfully I have no idea. Well, I have an idea; but I can’t get you pre-approved. Sorry.
But I have good news! I know someone who can!
And actually, I just ran into Shanna Wroten-Tucker, mortgage professional extraordinaire, atÂ StarbucksÂ and asked if I could interview her for this blog post. Obviously she said yes. Because she’s really that cool.
Q: Is it hard to get a mortgage today?
A:Â If you are a first time homebuyer in Idaho, youâ€™ve probably heard rumors.Â The media says mortgages are next-to-impossible to get. Bad news sells, right? Or that the process is brutal. Its really not. Or that the decline rate is high. Which I find interesting since we still approve more people than we decline! So let me ease your mind, lots of people are getting mortgages today and taking advantage of historically low interest rates!
Q: What do people need to have ready to provide to you?
A:Â Itâ€™s a â€œfull docâ€ world.Â New legislation requires that we document your employment, income, assets, and your “cash to close source” — in other words we need to document where all the money is coming from. Both your credit historyÂ and the property must also meet certain criteria. So, plan to bring things like paystubs, W2s, tax returns, and asset statements. And bring complete documents, not partial.Â Make sure the copies are legible.Â Its actually usually easiest to email documents to your loan officer before you meet so they can review for missing pieces.
Q: So what determines if someone can get pre-approved?
A: Hereâ€™s what we look at: Credit, Capacity, and Collateral.
We look for the strengths in your file. We want to make this work for you. We love income and employment stability obviously, the longer the better. But that doesnâ€™t mean being new on the job is a deal killer! We love assets; a down payment is â€œskin in the gameâ€ and extra cash shows a borrower has stability. But this doesnâ€™t mean we can’t find a loan where you’ll need very little down. And obviously we love good credit. However there are programs that will allow scores as low as a 580 get pre-approval! So really, those are the things that determine if you can get pre-approved or not.
Q: What happens if someone CAN’T get pre-approved?
A:Â Remember, we want to make this work for them. If your credit, employment or income are not â€œinside the boxâ€ then weâ€™ll set you up on a â€œpath to buyâ€ program.Â If the property doesnâ€™t meet lending criteria, weâ€™ll discuss some of the amazing government programs that allow you to finance the cost of renovation.Â In short, weâ€™ll give you the tools you need to get where you want to go.
Q: So at the end of the day, the best thing someone can do is contact you?
A: Haha! Yes, absolutely. We aren’t trying to sell anyone anything. We want to help people get into a house.
Shanna Wroten-Tucker (NMLS 63357) and her husband, Dean Tucker (NMLS 103829) are Idaho licensed mortgage loan originators with Benchmark Mortgage (Ark-La-Tex Financial Services, LLC NMLS #2143.) Shanna has beenÂ working with clients and real estate professionals in the Boise area since 1996.Â Shanna has made notable contributions through articles and presentations on various subjects related to the mortgage and real estate industry.Â Nothing herein is financial, accounting or legal advice. All loan programs are subject to change with out notice and nothing herein is a commitment to lend. Benchmark Mortgage is located at 2535 W State Street, Boise, Idaho 83702 and can be reached at (208) 388-0500 or on the web at www.DeanAndShanna.com