Buying a home is a big investment. So, when it comes to making an important decision like this, you want expert advice. We will walk you through each step of the lending process and keep you updated on the status of your loan application from pre-approval to closing.
Your Homebuying Experience
Let’s get started! The home buying experience is a learning process. As you move through it you’ll have a number of options to weigh. But, before beginning the search for that dream home, there are a couple of things you can do to prepare. Taking the time to prepare and understanding what is involved in obtaining a mortgage loan will make you not just a smarter home buyer, but a smarter homeowner as well.
SHOP SMART
Whether you are looking for a move-in-ready home or fixer-upper, weigh the cost of redecorating or fixing structural issues.
KNOW YOUR OPTIONS
At Ideal Lending, we have multiple loan programs available ranging from VA and USDA to FHA 203(k) loans. We’ll explain the benefits and requirements of each, so you are fully informed of what you are eligible for. Feel free to ask lots of questions along the way.
GET PRE-APPROVED
A pre-approval* is a detailed, picture of your creditworthiness verified by a full review of your income and assets by an Ideal Lending Mortgage Underwriter.
With a pre-approval letter in hand, you’ll have the confidence you need to make an offer, know what you can afford, negotiate better and close faster.
Five Reasons to Get a Pre-Approval
An income-based pre-approval from Ideal Lending offers a number of advantages that will make your search easier and negotiations more effective when you’re ready to make an offer. A pre-approval takes into account your income, debt, and credit history to determine how much the lender is willing to loan you.
- Finding the right home at the right price begins with knowing what you can afford. A pre-approval based on your income and expenses gives you the home-buying budget you need.
- With a pre-approval in hand, you can shop with the confidence of a cash buyer for your new home.
- Your pre-approval will provide your realtor with the financial information they need to focus your search on homes that you can afford, saving you both valuable time.
- With a pre-approval you’re able to make an immediate offer the seller will take seriously in a highly competitive real estate market.
- The sooner you close, the sooner you can move in. A mortgage loan pre-approval means you’re loan application is already in process. Once your offer is accepted you and the seller can expect to save time and close the deal quickly.
Multiple Loan Products to Suit Your Needs
FHA
A Federal Housing Administration (FHA) loan is a mortgage that is insured by the FHA and issued by an FHA-approved lender. FHA loans are designed for low-to-moderate-income borrowers; they require a lower minimum down payment and lower credit scores than many conventional loans.
VA
Just for veterans and surviving spouses! Finance up to 100% of your new home’s value with no money down, no appraisal fee, and no private mortgage insurance; or refinance your home quickly and easily with minimal paperwork.
Conventional
First-time homebuyers can purchase with as little as 5% down. Purchase using gift funds for your down payment. Competitive rates and fixed terms available and lower FICO’s may qualify.
Jumbo
Purchase with as little as 15% down with a Non-Conforming Jumbo Loan. Jumbo loans are available for loan amounts in the $500,000-$2,000,000 range, and sometimes higher.
USDA
Qualified borrowers can purchase a designated USDA rural property up to 100% loan-to-value with no down payment. Flexible credit guidelines apply.
HomePath
Purchase Fannie Mae eligible real estate owned properties for as little as 5% down and no appraisal fees or premium mortgage insurance is required. For eligible properties visit: www.homepath.com.
Foreign National
Foreign Nationals can purchase up to $3M on primary residences. No credit score is required unless available… If available, a minimum FICO of 680 is required.
Finding the Right House
Let’s start with finding the right house. Before you begin your search for a home, it’s important to identify the type and style you’d like. Build your checklist by asking yourself some key questions. Once completed, sharing this list with your real estate agent will help them focus on finding a home that’s just right for you.
As you put together your list keep in mind on average most first-time buyers move within 5 to 7 years. Set your sights on identifying what meets your needs now and into the foreseeable future. Your list is about identifying basic needs that must be met and features you’d like to have.
Your Family’s Needs
What will make your home, comfortable, efficient, and livable?
- How many bedrooms do you need?
- Does each child need their own room?
- How many bathrooms do you need?
- Do you need a guest room or home office?
Ideal Amenities
What added features do you want? Then, prioritize based on importance.
- Working Fireplace
- Central Air Conditioning
- Hardwood Floors
- Walk-In Closets
- Gourmet or Eat-In Kitchen
- Large or Fenced Yard
- Swimming Pool
- Three Car Garage
Asking Yourself the Right Questions
How do I make an offer?
When it comes time to make an offer your real estate agent will be invaluable. He or she will help determine the amount of your offer and manage the negotiations which follow. Using comparable homes in the area that have recently sold, your realtor will be able to assess a reasonable value of the home. While not an apples-to-apples comparison, this information provides a useful guideline in determining price. Don’t hesitate to offer less than the asking price to start. This is typically expected by the seller. In rare instances when a market is unusually hot, will the seller expect full asking price.
Once you and your realtor have settled on an asking price, he or she will begin the negotiating process. Here’s what you can expect:
- Your realtor presents your offer to the realtor of the seller.
- The seller will consider your offer and either accept or reject it.
- Should your offer be rejected, you can submit a counteroffer or withdraw altogether.
- Expect some back-and-forth before you agree on a price.
How much can I afford?
Knowing just how much house you can afford will make your search much easier. This is probably the most important question for first-time homebuyers. But, don’t rely on an online mortgage calculator or even a realtor’s back-of-the-envelope guesstimate. These rough estimates can leave important financial details out of the equation.
Why do I need a Loan Officer?
The best way to know how much you can afford, and put yourself in the best possible position when it’s time to make an offer, is to get a pre-approval* from a reliable mortgage lender. An experienced Loan Officer will:
- Help you obtain pre-approval.
- Have access to a wide range of loan program that can meet most any need. Including loans with little or no down payment, VA loans, or FHA loans which can be ideal for first time home buyers.
- Keep you up-to-date on the progress of your loan application through closing.
- Be able to assist you in identifying areas where you may be able to improve your credit score.
Do I need a Real Estate Agent?
Just like your Loan Officer, a qualified professional real estate agent has resources you’ll never be able to find on your own. An experienced real estate agent will:
- Have expertise of the local market and early access to new listings before they hit the internet.
- Have a good working knowledge of the neighborhood and local amenities
- Be a better negotiator providing much needed perspective because they are not emotionally involved in the sale.
Buying a home without an agent can become a big hassle very quickly. Because a home purchase is a legally binding contract you will need access to an attorney. Also, remember that the real estate agent is paid by the seller, not the buyer.
Mortgage Checklist
Preparation is everything. These are the documents you’ll want to have ready to complete your loan application. Below is the information that is typically required throughout the loan process.
Copy of the following for each applicant:
- Drivers license
- Social security card
- W-2’s from all employers for the past 2 years
- Paycheck stubs for the past 30 days
- 2 years of tax returns complete
- Bank statements for the past two months
- 401(k) and profit sharing statements
- Complete quarterly or semi-annual statements for IRA’s, CD’s, money market fund, stocks, proof, in the form of a bank statement, that any earnings resulting from investments was deposited and has cleared
For purchase transactions (some of these won’t be applicable until you have a property under contract):
- The Purchase Contract
- Copy of your canceled Earnest Money Deposit Check
We’re committed to making your first home-buying experience great! As dedicated mortgage professionals, we believe that each and every one of our loan transactions is the beginning of a relationship that will last a lifetime! Contact us today to see if you qualify!
