How to step up your mortgage purchase game
With the spring market getting an early head start it will most likely be a hot month for those selling in the next few months. If you are a buyer looking to purchase now it is important to differentiate your loan from the other guy making an offer.
Step 1 – Get Pre-Approved or Better Yet Fully Approved
You do not have to wait until you first choose a realtor and look at properties to find out how much you can get approved for a mortgage. In fact in almost every case it is better if you speak to a mortgage professional first before you go out looking for that new home.
Being prepared before you even set foot in a home you are interested can save you a lot of time and strengthen your offer. If there are any surprises lurking on your credit report for instance, a mortgage professional can quickly work with you to get these resolved. They can take all your information and make sure you are as prepared as possible when you are ready to make that offer. Better still some lenders offer a TBD Purchase Program that puts you even further ahead of those who have only been pre-approved. Simply put, the TBD Program has your loan completely approved to a dollar amount that you and your loan officer agree upon. It is a full mortgage commitment by our underwriter. The only thing that has to be completed to close on your loan is the ratified contract, appraisal and a clear title order.
Step 2 – Be ready to update documentation
No matter what program you choose or when you close, mortgage documents, much like a loaf of bread, can go stale. Your loan officer will need updated documents through out the process, especially if the closing is not in the typical 30-45 window most realtors and seller prefer.
Step 3 – Keep those statements
Whether you get items digitally or are a paper traditionalist, keep a record back of the actual statements, pay stubs and anything else that may have a financial impact for at least two months back when you are thinking you are getting ready to jump into the game. Being able to show and document these items in advance makes it much easier than going back and having to offer up an explanation.
Step 4 – Have your explanations ready
This step goes hand in hand with step 2 and 3. Large deposits, gaps in employment or credit inquiries are some of the major items you have to keep track for your mortgage. Having the documentation to show a paper trail on deposits into your account is a big and necessary item that underwriters cannot get away from.
Having these items ready and together in advance will have you way ahead of the game and when going the extra step of having the full TBD commitment can really make your offer stand out over the other guy.
Be prepared to put an earnest money deposit down
While everyone’s qualifications will differ, the more you can show the seller you are serious with you offer the better off you will be. One thing that you can do is try to put a larger than normal earnest money deposit down on your contract. The more money at risk the more you tell the seller you are not willing to walk away from a deal.