In order for a real estate consultant to help you in your home search, the first step is to get pre-approved for a loan through a reputable loan consultant.
Loans are not like they used to be where you could put 0% down and have the seller pay the closing costs. With the lender melt-down, lenders are requiring a minimum of 3.5% down (with an FHA loan) or 5% (with a Conventional loan). If you have less than 20% down, you will be required to pay PMI (mortgage insurance) along with your payment. Lenders are very strict in their underwriting and will require piles and piles of documentation for your income, accounts, assets, etc. Be prepared for a somewhat laborious process to get pre-approved for a loan. If you are short on cash, talk with your agent about negotiating to have the seller pay your closing costs, however, you will still need some cash on your own. If you are going to get gift money from parents, relatives, etc. be sure to talk to the loan officer about the best way to handle that.
You can get pre-approved free (no cost or obligation) by applying with one of the loan consultants listed above. They are preferred loan consultants because we trust them and have worked with them. They will not “take you for a ride” with extra fees and they will give you the best rate you qualify for.
Be prepared when you start your pre-approval process. You will need access to the following information for your application:
- Home address(es) for the previous two years
- Your social security number(s)
- Employment information for the previous two years including employer name, address and phone number
- Income information including salary, overtime, bonuses, commissions, dividends, interest, retirement and any other source of ongoing income
- Liquid assets including bank name, account type, balance, and source of down payment
- Other assets including the value of bonds, stocks, life insurance, retirement funds, jewelry, automobiles, etc.
- Liabilities including creditor names and outstanding balances for all debts including notes payable, 401(k) loans, life insurance loans, stock pledges, alimony, child support, co-sign loans, credit union loans, and other liabilities
- Real estate owned including property address, market value, outstanding liens, rental income, mortgage payments, taxes, insurance and maintenance dues
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