Buying a home is one of the largest investments someone will make in a lifetime.  Getting a mortgage is one of the biggest loans in the budget.   Take a little time to save yourself a lot of money.  Team up with the experts and use their experience to save yourself from a bad experience. 

Taking a few extra minutes to prepare can give you big bragging rights on your real estate deal for years to come.

Here are some things to do as you set out to buy your home or get your mortgage.

Determine your budget.  Set a timer for two to three hours, turn on your favorite tunes and start slogging through your last six months bank statements and credit card statements.  Keep a tally of how much you are spending on food, rent, utilities, gas, insurance and more. Remember those bills you only pay once or twice a year like your car tags and insurance.   By the end of those two or three hours, you will know a lot better where you can save some bucks and how much you can comfortably afford for a house note.   Remember you need to have an ample amount in savings for emergencies.    How much money can you comfortably put down at closing and still keep your “rainy day” fund?

Are you planning to change jobs soon? Are you switching from a guaranteed W2 income to be a subcontractor or will you be retiring soon?  In most cases, the mortgage company will not use your self-employment income or 1099 subcontractor income unless they can average the net income from these income sources over the last two years. If you are planning to retire, make sure that the house payment that you determined would be comfortable will work on your retirement income. Make sure your timing on a job change or major purchase does not occur during the loan process.  

Putting together your team of experts

Take the time necessary to find a reputable lender that shows the most interest in helping you get the best mortgage terms to fit your plans.   A good lender will ask you questions about how long you plan to stay in the home you want to buy.   A good lender will explore different loan programs or a combination of loan programs that will help you get the house and financing you want, but stay in your comfort zone.  Ask the lender for a strong prequalification letter for the terms you need when you make an offer on a house. 

Find a reputable real estate agent.  Check reviews to track down an experienced realtor who is getting results for his or her clients. Hand to your realtor a list of features and amenities in order of priority that you absolutely require from a home you plan to purchase.   Make a list of things you do not want in your home.  These list can save you and your realtor time when you are searching for the right home. 

Once you have the contract on your home, you may opt to get a home inspection.  Home inspectors put their focus on the condition of the property.  If there is a looming problem with the roof or the foundation, it is better to know up front before you sign on the dotted line to purchase that home. 

If you are getting a mortgage, the lender will order the appraisal through a third-party appraisal ordering company. The appraiser, unlike the inspector, is there to determine a value of the home.  If there are obvious items at the house that affect the structure, security or sanitation of the home, an appraiser will note these items on the appraisal report.  Most lenders require that those type items be repaired before closing.   You may find some workarounds with the lender if you can’t do the repairs before closing.  

Other good team members to advise you on your homebuying journey are homeowners insurance agencies, home repair men, and a good closing attorney or title company. 

Finding the home that will be your castle

Look for homes that are priced to stay within your comfort zone on the monthly payment and the down payment. 

Are the homes in the neighborhood well maintained?

Drive through the neighborhood at different times of the day to get an idea of how much traffic comes through the area.

Will the home, the lawn and the parking work for the way you and your family like to live in a home?

Is the house close to places of interest to you like schools, shopping centers, work and public transportation?

Make a Plan B for your closing date

If you have a house you need to sell first before you can buy your new home, then put together a contingency plan to give you options, just in case both closings don’t close on the same day .

Check your calendar to make sure you have plenty of time to close on your new home, even if the seller can’t close on the day you had planned to close.

We have all heard the theme song to the TV show COPS. See, the song already started playing in your head! Now just make a quick substitution: 

LOs, LOs; whatcha gonna do? Whatcha gonna do now that your rates ain’t TWO?

Inflation continues to push prices higher. Bond yields are responding for fear of that inflation. Ten Year T pushed past a critical 1.63 level and has closed above it. So 30yr mortgage rates have left the 2% level smack into the mid 3% arena causing refinances to fall off.

Loan officers, managers, and company ownership are all facing the facts that refinances are going away rapidly, and what was once the major force in originations is now off by 22% year over year as rates continue to rise. If your business was 50% - 60% - 70% or more refinances; whatcha gonna do for business in 2022?

There are some promising strategies that my clients and I have been working on to maintain loan volume by focusing on positive outcomes that are really paying off. As part of October being Business Planning Month, driving to provide value to our community and attracting the best referral partners from all walks of life, and especially building a database that returns opportunities day in and day out!

The more challenging the business may become; the greater the value in having a proven plan in place so your can schedule your success!

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