After months (or maybe years) of going back and forth, you’ve finally decided you’d like to buy a home! Great! So…now what?
Your first inclination may be to go online and browse homes to see what the current inventory for your budget is like out there. But, you’re actually skipping over a very important first step. Before you can start seriously considering properties, you have to get a clear picture of your financial situation and understand how much you can actually afford. It would be heartbreaking to find an amazing place only to be told by your bank that you are not qualified financially to buy it.
The first thing you should do once you’ve decided to buy a home is speak with a mortgage broker. After reviewing your personal financial information, your mortgage broker will be able to tell you the proper price range for your search and will be able to give you an idea what kind of loan terms you could receive from lenders. Most importantly, a mortgage broker can also issue you a pre-approval letter.
Pre-approval is not the same thing as pre-qualification. A pre-qualification is an estimate of how much you can afford in a mortgage payment based upon basic information you provide in an initial conversation. A pre-approval, on the other hand, is a commitment on behalf of the bank which includes a credit check and employment verification.
Pre-approval is a must in today’s market for any serious buyer. Real estate in New York City now is hyper competitive, with lots of well qualified buyers (including all cash buyers). With all the options out there, sellers will not take any potential buyer seriously without a pre-approval, which gives them the security of knowing that you are financially qualified to make the deal happen.
Are you in need of mortgage broker recommendations? Do you have more questions about buying (or maybe selling) a home? Feel free to contact me. I’m always happy to help!