How Do You Take The First Step?

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Everyone knows how to look at houses. You may have been looking to get an idea of an area that you are interested in either by driving around or checking out various websites. Maybe you’ve found a neighborhood with a couple houses for sale that is in a great school district, near your job or favorite restaurant, and it’s just the right square footage! But now what?

Have you gone to a bank and been pre-qualified or pre-approved? Wait, there’s a difference? Don’t worry, we’re here to clarify!

  • ·Pre-Qualification : This is the first step, but it’s not necessary. If you want to shop around for houses but you aren’t sure how much you can get approved for on a loan, this is a fairly hassle-free way to get a price range. This option doesn’t check your credit but a loan officer will go over your income, debts, assets, and any money you have saved for a down payment in order to determine what you can afford. If you know your allowance, you know your options. We also have a loan calculator for you on our website which is another non-invasive way to get a general idea.
  • ·Pre-Approval : This step is for when you’re serious! Maybe you’ve already been pre-qualified and you’re ready to make an offer. Your dream house in your dream neighborhood just entered the real estate market and you’re ready for step two! You will have to call your loan officer and set up an appointment. Pre-approval is a little more extensive than pre-qualification since the loan officer will go over your credit report and they may charge you a fee. You will also need to bring some documents with you such as bank statements, tax returns, pay stubs, driver’s license, and any other assets you may hold such as stocks or mutual funds. Your loan officer should tell you exactly what you need to bring. They will then peruse these documents and let you know exactly how much you qualify for. After this step…
  • ·Good Faith Estimate : If the bank is going to pre-approve you, they will give you a Good Faith Estimate which just lets you know what the terms and interest of the loan would be. It doesn’t commit you to anything, but gives you an idea of what that bank is willing to offer you. Just like anything else you may buy, it’s a good idea to shop around and see what other rates may be available to you if you aren’t satisfied with the GFE that you have already received. While this may seem time consuming, it is definitely a step that is necessary for comparison shopping. You may be paying this mortgage off for a while, so you want to make sure you have one that is the best deal you can have!

So after you’ve received a GFE that you’re confident in, try to maintain your credit line! A Good Faith Estimate or pre-approval is NOT a guarantee for your loan. If you were also thinking about buying a new car, WAIT!! Loans and mortgages are based off of your credit and if that credit line changes or if more debts are added, your loan amount may decrease or the bank may not even be able to approve you.

We have local loan officers we can refer you to if you don’t know where to start.
Feel free to call us at 405-509-9350 or email us at theallengroup@sellingoklahoma.com.

Good luck and happy house hunting!

Anya Taschereau
The Allen Group

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