Here is a Very Informative Article from Jamie Richardson of Realty Biz News!
Buying a house is the ultimate dream of many people. Nowadays, the choice of property you can own is huge. Many things are put under scrutiny: the location, area, style, age, et cetera.
In addition, many steps should be taken before one decides which house to buy. Some people decide to save money first and then buy a property. However, the prices for real estate are continuously growing, and it might take decades before you can afford to buy a house.
Another type of buyer decides to get a loan in order to cover the costs needed to afford the house. For instance, many people decide to take a fixed-rate mortgage and to pay the same interest rate every month.
One of the most frequent mistakes people make is deciding to talk to a lender after the house is already chosen. However, there are at least six reasons why you should not do so. Here you can find the list of advantages of consulting with a lender before house hunting:
1.You Will Get Pre Approved
Pre-approval is one of the most crucial steps in the process of house-hunting. It will be a signal for a house owner or the real-estate agency that you are seriously determined to buy a house.
The real estate agents will reinterpret it as the sign that the time spent on you is not wasted, and you are a valuable client. In addition, your offer will be more competitive because it will give them confidence that you can afford to buy the house, and no unexpected surprises will occur.
2.Your Expectations Will Be More Realistic
Usually, we cannot calculate precisely how much money can be borrowed. Therefore, while choosing houses, people tend to select the most beautiful and luxurious ones. However, their price will always be much higher than we expect.
The moment when one becomes aware of the fact that they cannot receive a sufficient amount of money to buy the house of their dreams is always painful. But only if one already knows their real possibilities and what is the price range they should pay attention to, this situation is not likely to occur.
3.A Lender Might Help You Calculate Your Down Payment
Apart from paying on a monthly basis, a certain sum of money, loans require a down payment. This is the initial payment one should make when buying property on credit.
The percentage one has to pay depends on the country, region, company and many other factors. The lender will help you calculate which amount of money you would have to spend on the very beginning.
In addition, many experts recommend making a down payment, which is higher than the required one. It will lower the financial risk of the lender and make your application stand out from the rest.
Gathering all the needed documents for buying a house is a long process. Many people postpone it and believe that it can be done at the very last moment. However, it is not true.
If you consult with a lender company far before buying a house, a large amount of paperwork will be done in advance. First of all, it will create an image of the buyer who is aware of the responsibility for the choice they make. Secondly, it will facilitate the process of buying a house.
Indeed, doing everything at the last minute is not the best option when it comes to buying a property. An organised approach is needed in this case.
5.You’ll be Alerted to Potential Problems.
Every person’s credit history is different. However, there are a number of problems that one may have in it, that might create an obstacle on one’s way to buying a house.
The mortgage might be denied in case you missed the payment recently, or you had CCJ or too many credit applications. Talking to a lender will give you enough information about these factors, and it will be easier to avoid any issues in the future.
It is highly recommended to solve such issues before you start house-hunting. Neither you or real estate agents want to have an unpleasant surprise in the process of buying a house.
6.Your Offer Will Be More Competitive
If you reckon that you are the only potential buyer of the house you like, you are mistaken. Nowadays, there are many house-hunters. Therefore, the owner of the property or a real estate agency has different criteria according to which they choose the reliable buyers.
The fact that you had already talked with a lender, and got pre-approved is a huge plus in this competition. In addition, both parts will be sure of the fact that there won’t be any potential problems while getting a mortgage. Therefore, it is an indispensable step one should take in case they want to stand out from the rest of those eager to get the same property.
Source: 6 Reasons to Talk to a Lender Before You Start House-Hunting – RealtyBizNews: Real Estate News