7 helpful tips when buying a home

  Written by Vannessa ESKEW on Mar 11, 2008 7:17 am

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1. Get preapproved before looking for a home. 

Do not confuse a pre-approval with a pre-qualification. During the pre-qualification process, a loan officer asks you a few questions and then hands you a pre-qual letter. The pre-approval process is much more complex. To complete pre-approval, a lender must complete an entire loan application including credit and employment verification. The only portion of the application process which is excluded is the appraisal and title search. Pre-approval can help buyers get the home they desire. Once the prospective home buyers are pre-approved, they become a CASH BUYER and have more negotiating power. Home buyers can then save thousands of dollars as a result and can be in a better negotiating situation. 

2.  Consider all options when choosing a lender.

While rate is important to borrowers, one should also review the overall cost of a loan. This includes looking at the APR, loan fees, discount and origination points. Some lenders include origination points in their quoted rates while other lenders add origination points in addition to their quoted points. So, when one lenders says 2 points they mean 2 points, whereas another lender means 2 points plus 1 origination point. The company that has the absolute lowest quoted rate may not be the best company for your mortgage business. 

3.  Get a rate lock in writing.

When a mortgage company has locked your rate, make sure you receive the following: a written statement that details the interest rate, the length of the rate lock, and details about the program. 

4.  Be sure to receive a professional inspection.

Taking the seller's word that they have made repairs is not necessarily a smart thing to do. Unless the purchase is a new house with warranties on most equipment, it is highly recommended that the buyer acquire a property inspection, a roof inspection and a termite inspection. Inspection reports are great negotiating tools when it comes to asking the seller to make repairs. If a professional home inspector states that certain repairs need to be done, the seller is more likely to agree to do them. If the seller agrees to do the repairs, have the inspector verify that they are done prior to close of escrow. Do not assume that everything has been done the way it was promised.

5.  Place homeowners insurance prior to closing.

Buyers should start shopping for insurance as soon as an offer has been accepted. Many buyers wait until the last minute to get insurance and then they have little time to shop around for the best policy. 

6.  Read all documents prior to signing them.

Time and effort should be spent reading any and all documents. It is advisable for buyers to ask for a copy of all the loan papers at the close of escrow. This allows ample time to review these documents, review any verbal agreements that may not be included in the written documents and get any questions answered. However, buyers should not expect to read all documents during the closing. There is rarely ever enough time to do that. 

7.  Schedule your moving plans carefully.

Buyers should allow for a 5-7 day overlap between closing and moving. Example: If one expects to move out of their prior residence on a Friday and into their new residence over the weekend, they will notify their landlord to end their lease on that Friday. They then arrange for movers to help on that same day. If their loan closing gets delayed until the following Tuesday, they may become homeless! New tenants could be moving into their apartment and the movers could charge the buyers for wasting their time. The buyers could be forced to live in a motel for a couple of days! In the long run, it is not nearly as expensive to plan ahead to achieve peace of mind.

Thank you,

Vannessa Eskew

Loan officer

Nationwide Mortgage Lender

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