Home Buying Process
April 23, 2007
More and more, potential home buyers begin their home buying process by searching online or by touring open houses. Certainly these two actions will allow a potential buyer to become somewhat familiar with the real estate market in the area in which they would like to purchase a home. However, there is ultimately a weakness in this strategy. Many of the web based real estate databases are not 100 percent current. I have checked our market area and find properties still listed as available when in fact they were sold several months ago. Going to open houses does allow a buyer to check out what amenities can be had in a particular price range and also to look over the real estate agents who host these open houses. The weakness in this strategy is that only a percentage of the total properties available can be viewed at open houses. The prime properties are shown by agents and, even in a slower market, they sell before an open house is scheduled and potential buyers never have the opportunity to preview them.
The recommended first step is for the buyer to get "pre-qualified" or "pre-approved" for a home loan. This allows a buyer to know how much the monthly payment wil be and how much the down payment and costs will be. "Pre-qualified" generally means that a buyer has spoken to a loan officer and based on the fiancial information given, the loan officer estimates the amount of loan the buyer could qualify for. "Pre-approved" generally means that the buyer has filed a loan application, credit and employment verifications have been obtained, and the buyer is approved for a specific dollar amount of loan and monthly payment. In the "pre-approved" scenario, typically everything has been done but an appraisal of the property. For a seller, the "pre-approved" buyer is looked at very favorably.
Buyers are anxious to look a homes, but in today's world, knowing your borrowing potential is the very best place to begin the home buying process.
More and more, potential home buyers begin their home buying process by searching online or by touring open houses. Certainly these two actions will allow a potential buyer to become somewhat familiar with the real estate market in the area in which they would like to purchase a home. However, there is ultimately a weakness in this strategy. Many of the web based real estate databases are not 100 percent current. I have checked our market area and find properties still listed as available when in fact they were sold several months ago. Going to open houses does allow a buyer to check out what amenities can be had in a particular price range and also to look over the real estate agents who host these open houses. The weakness in this strategy is that only a percentage of the total properties available can be viewed at open houses. The prime properties are shown by agents and, even in a slower market, they sell before an open house is scheduled and potential buyers never have the opportunity to preview them.
The recommended first step is for the buyer to get "pre-qualified" or "pre-approved" for a home loan. This allows a buyer to know how much the monthly payment wil be and how much the down payment and costs will be. "Pre-qualified" generally means that a buyer has spoken to a loan officer and based on the fiancial information given, the loan officer estimates the amount of loan the buyer could qualify for. "Pre-approved" generally means that the buyer has filed a loan application, credit and employment verifications have been obtained, and the buyer is approved for a specific dollar amount of loan and monthly payment. In the "pre-approved" scenario, typically everything has been done but an appraisal of the property. For a seller, the "pre-approved" buyer is looked at very favorably.
Buyers are anxious to look a homes, but in today's world, knowing your borrowing potential is the very best place to begin the home buying process.
posted by shirley harry at 8:15 AM
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