As the events of the last few years in the real estate industry show, people forget about the tremendous financial responsibility of purchasing a home at their peril. Here are a few tips for dealing with the dollar signs so that you can take down that “for sale” sign on your new home.
Get pre-approved. By getting pre-approved as a buyer, you can save yourself the grief of looking at houses you can't afford. You can also put yourself in a better position to make a serious offer when you do find the right house. Unlike pre-qualification, which is based on a cursory review of your finances, pre-approval from a lender is based on your actual income, debt and credit history. By doing a thorough analysis of your actual spending power, you’ll be less likely to get in over your head.
And, without a pre-approval letter from your lender, chances are your offer will be rejected.
Choose your mortgage carefully. Take the time to sit down, preferably in person with your lender to discuss all your options. Just like buying a home, sometimes you don't know what you've got until you've completed your inspection. Don't wait until you're under contract before checking out what special financing might be available to you. Your loan officer is there to advise you on the best loan package that meets your current, financial needs.