Steve's Home Buyer Tips

By Steve Fischer

309-743-0110

Moline, IL – Are you thinking about buying a home? It can be an overwhelming process. Especially when what you see, hear and read in the media is all ‘doom and gloom’ and talking about the ‘subprime mortgage meltdown.’ Don’t let it stop you. You can still buy a home for little to no money down, even in the middle of the ‘topsy-turvy’ market we’re in now. All it takes to make it happen is little preparation and some careful planning. And these 9 tips can help get you there:

1. Educate yourself. Learn all you can about the home buying process. Understand the role of each party involved. Explore your loan options. Learn all you can about the approval process. And give yourself a clear picture of what to expect regarding time frame, costs… even possible delays. Real estate professionals have a ton of resources they can share with you. Use their expertise to get you started!
2. Get a copy of your credit report. You can get one for free at www.annualcreditreport.com. Check it for incorrect items, duplicate entries, address and employment information and inquiries. Your lender can help you review it and ‘make sense of it all.’ Usually for free.
3. Resolve any outstanding credit issues. Make arrangements to bring any delinquent accounts and/or collections current. Keep accurate records of all everything. And be prepared to provide a letter of explanation to your lender to explain any past issues. Normally, your lender will assist you with this. Once you get any outstanding issues resolved, be sure document how you did it. If there are no issues, great. You’re one step ahead of the game!
4. Plan a realistic budget. Analyze your spending. Cut back wherever possible. And be ready to have funds available to cover your costs to buy. Even if you’re getting a ‘no down payment’ home loan, you’ll still need to set aside some money. What for? Things like an ‘earnest money’ deposit, homeowners insurance, and moving expenses. You’ll need to let your lender know where your funds came from. If you don’t, you’re loan could be denied. Don’t let it happen! Some lenders even require your funds to be ‘seasoned,’ or on deposit, for anywhere from 30 to 90 days.
5. Get your paperwork in order. In most cases, it’ll be necessary to provide proof of your income, assets, and things that affect your credit rating. If you’ve been through a divorce or bankruptcy, you’ll need to have the paperwork for these available also. Your loan officer can give you a checklist for your specific situation.
6. Get actively involved in the process. Be honest and upfront about everything. When asked to provide any additional information, do it in a timely manner. Not doing it will slow down the process. Extended delays can even cause your approval to expire… and result in less favorable loan terms (i.e. a higher rate or lower loan amount.)
7. Don’t make any major purchases before or during the loan process. This could adversely affect your debt ratios. It can also deplete the cash reserves you need.
8. Stay positive. Sure, the process can be challenging. But the reward is great. The more prepared you are, the smoother the process will be for you. Finally…
9. Get expert advice. Seek a knowledgeable professional with experience. Ask them for references upfront. And make the smart decision of putting them to work for you. Don’t ‘go it alone!’