How To Efficiently Find Your Dream Home
Rebecca and I are often asked “what’s the best way to go about finding my next home?” From my experience in being involved with both good and bad transactions over the years the best way to locate and buy the perfect home is a three step process – loan preapproval, web searching, and employment of a professional Realtor. I’ve listed them in order of importance as each builds on the previous step.
There is absolutely no sense in even dreaming about a new home until you’ve had your loan preapproved. It doesn’t matter how high your credit score is or how much money you make, I guarantee you that “good” borrowers are having their loans turned down all the time for one reason or another. There are just too many potential skeletons in the closet that lenders are trained to look for and that you never would have thought would be a problem. A preapproval will make the process much less stressful, allow you to shop with full knowledge of exactly what your payments and closing costs will be, and place you in a much stronger negotiating position with the seller of the home you chose.
Expect the preapproval process to take anywhere from a couple of days to a couple of weeks depending upon how simple or complex your particular situation is. It should not cost you more than about $18 for the credit report and there is no obligation to continue with the loan if you don’t feel comfortable with the lender.
Do NOT take the loan officer’s verbal commitment that your loan is “pre-approved.” I can’t stress this enough. I get calls on a weekly basis from borrowers who were a week away from moving into their new home after being assured by the loan officer that everything was “ok,” only to have the Underwriter deny the loan. Every lender issues a formal written decision once an Underwriter has analyzed the file. Do not start making offers on homes until after your loan application has been reviewed by an Underwriter. While it is normal to have a handful of conditions, you need to make sure none of them are deal killers that you can’t satisfy.
After your lender has reassured you that you are fine to move forward you’ll want to begin using the web to search for homes. I wrote “homes” plural because I believe your mindset at this point needs to be that you are just trying to zero in on a particular neighborhood or two and to get an idea of how much your dream home is really going to cost. Try not to get emotionally attached to any particular home until you are positive of what neighborhood you want to move into.
If you do a Google search for “homes for sale in Spokane,” you will immediately see dozens of real estate agent websites from which you can search for homes. Keep in mind that any site that requires you to “register” will likely mean that agent will have added you to their prospect database and may follow up with you directly. Some sites do not require registration and you can search anonymously.
Once you’ve done your preliminary home search on the web it’s time to partner up with an awesome agent. Your agent should be someone you like and trust as they will be handling a very important transaction on your behalf. They should have intimate knowledge of the specific neighborhood you want to move to and they need to be an expert contract negotiator. It’s best if you can be referred to an agent by someone who can personally vouch for their past performance. If not, it is certainly a good idea to interview a few agents to find one that you are comfortable with and feel you can trust.
Michael has 21 years’ experience in the lending industry. In that time he’s directly helped over 1,400 families finance the purchase of a new home or refinance an existing loan. Rebecca has a CPA background in auditing financial institutions which brings an incredible resource to First Priority Financial. They are licensed to help families in the states of WA and CA. If you, or anyone you know, needs help with a home loan call 509-252-9151 or send an email to Mike Mullin