Getting the "Right" Home

Finding the right home is still the biggest challenge buyers are faced with in today's market as is shown in the latest Confidence Index Survey. Assuming the buyers find the "right" home with determination, perseverance and the help of a real estate professional, 88% of all transactions last year required financing to get the buyer's address on the home. 93% of first-time buyers needed financing.

Pre-approval is an essential step that needs to be handled before buyers begin searching for a home. The benefits to the buyer fall into the category of confidence.

PRE-APPROVAL GIVES YOU CONFIDENCE

Knowing the amount you can borrow
the mortgage amount decreases as interest rates rise
Looking at the right priced homes
price, size, amenities, location
Comparing and identifying the best loan
rate, term, type
Uncover issues early that could affect the most favorable loan terms
time to cure possible problems
Bargaining power to negotiate with the seller and possibly, competing buyers
price, terms, & timing
Settlement can occur sooner after contact is accepted
verifications have already been made

Items Needed for Pre-Approval

Photo ID
Two months current pay stubs
Last two year's W2s
Complete copies of checking and savings statements for last three months
Copies of statements for IRAs, 401k, savings, CDs, money market funds, etc.
Employment history for last two years with addresses and contacts
Proof of commissioned or bonus income
Residency history for last two years with addresses and contacts
Assets for down payment, closing costs, and reserves; must provide paper trail
If self-employed, last two years tax returns, current profit and loss statement and balance sheet; copy of partnership/corporate tax returns for last two years if owning more than 25% of company
FHA requires driver's license and social security card
VA requires original certificate of eligibility and DD214
Other things may be required such as previous bankruptcy, divorce decree