It’s a common question: Can’t I just look at the house and get a prequal later? Who needs a prequal now?
Well for starters…“this” Realtor® does. And 99.9% of Sellers, and 99.9999% of Listing agents. But I digress.
Let’s get to your real question. You are out driving around on a gorgeous weekend (like the one coming up.) You see a sign in the yard of a house that you know has just been waiting for you and your family. You call the agent (your agent, the agent on the sign, any agent) you just have to get in that house now! Cool, I understand. But this is what I want you to know. With out a prequalification from a repudable lender – and no Guido & Guido Inc. doesn’t work – you may be wasting your time.
If you elect me to be your agent, it is absolutely my job to give you all the best information to make good decisions. Consider this:
- One of the worst things I can ever do is show you a house you could never buy. Growing up we always watched Life Styles of the Rich & Famous so we could see the crazy things rich people had – 200 foot yachts, a dozen goldplated toliets and so on. If I do that to you on a home that is just out of your price range, no other home will measure up – ever.
- Should you fall in love with the home I show you & decide to proceed with an offer, the seller under advice from their agent is going to counter, reject or stall until we get a loan prequalification in their hands. No seller is going to tie up their house waiting for you to get your financing in line or worse yet another buyer comes in with their prequalification in hand and you loose out.
- New Government Rules called TRID require lenders to have particular disclosures in a very concise time frame. Not meeting with a lender prior to writing an offer could delay your closing costing you more time, money or potentially the property.
- The type of loan you thought you could get, and that online mortgage calculator were wrong. You have to come up with more money down or you have a higher interest rate or you actually never figured in private mortgage insurance which just raised your payments by $100 per month.
- Once you start talking to the lender, you find out the income you thought was enough because of the way your taxes are filed actually isn’t, and you have to wait to refile your taxes or file this years returns. Your dream house is sold and gone.
You may think I am exaggerating a bit. Unfortunately, I have had seen these situations happen. Watching your dreams fade into tears is not really anything I need to experience ever again. According to the National Association of Realtors®, 96% of home buyers start their search online. Many will start 6 months before they even plan to buy. THAT IS A GREAT THING! But as you start clicking through the interwebs, get a loan prequalification so you know what your budget is. Then get ready to hit the streets. It puts you incharge of your home buying experience and makes you a player.
So, if you are thinking seriously that its time to start looking, please make your first step meeting or calling a lender who is in the area you are getting ready to purchase in. Dealing with a local lender is key (more on that soon). Get your loan prequalification in hand so then you can do some serious power shopping. Everyone will take you more seriously and the odds of you loosing your “perfect home” are greatly reduced.
If you would like help finding a local lender, just let me know. I have a great network to help you.
Mabury, Holly. (2016). Myth 101 – I Can Look at Houses Now & Get a Prequal Later. Retrieved from AZ Heartland.