Thanks to a fantastic #AREFchat this morning, we now have the three cardinal rules for home buyers when it comes to purchasing a new home. Today’s topic focused on the many obstacles that seem to prevent home shoppers from closing on a home.
Monte Hewett Homes (@MonteHewett) through me for a loop when they said a lot of buyers add or remove names from the contract after it has been signed. Making any kind of alteration to the contract after it has been signed will definitely delay the home buying process and change the financing qualifications. So, rule #1 – Do not change jobs, make a big purchase (i.e. a car), add/remove names from the contract or do anything else that will change the financing qualifications while you are under contract.
Moving along, financing seems to be the number one obstacle preventing home shoppers from getting to the closing table. We were extremely excited to have Jay Thompson (@PhxREguy) join us this morning. As a real estate agent in Phoenix, he had lots of experience with contracts not making it to closing. Surprisingly enough, he claims that lack of sufficient down payments are the biggest obstacle for buyers. Either they think that they can get a loan without any money down or very little money down. This brings us to rule #2 – Do not attempt to purchase a home without the minimum down payment and money for closing costs. In order to get a realistic idea of how much money is needed upfront between the down payment and closing costs, speak to a qualified lender.
Which is a great point to transition us to rule #3 – Consult with a qualified lender BEFORE you begin house hunting. It’s a great idea to know exactly what you can afford before you begin looking for a house. A lender can get you pre-approved for a loan, which will prevent any financing problems from popping up before closing. In addition, they will be able to give you specific details about closing costs, down payments and the estimated monthly mortgage amount. Go over these numbers so you know what your budget is, and, even if you are pre-approved for more than what you can afford, do not go over your budget.
These three rules will help any home shopper make it to the closing table.
