Many prospective homebuyers wonder when the best time is to meet with a mortgage adviser. My advice: meet early in the process! If you’ve started looking at homes, you should have already met with a mortgage advisor. If you’re thinking of buying a home within the next year, schedule an appointment with a mortgage advisor. No, it’s not too early.
There are a lot of issues that can be avoided if you meet early in the home buying process. Obviously, the whole thing of making sure you can qualify for the mortgage, that you’re buying in a price range that is comfortable for you and not stretching yourself, are often the primary issues that need to be resolved. Beyond that, though, most people just don’t know what they are going to find on their credit reports. Sometimes the worst of them are medical collections that people are completely unaware are out there. You go to a doctor, the doctor sends a bill that maybe gets sent to the wrong address or is just missed in the mail pile and you don’t pay it. Doctors don’t waste time; if a bill goes unpaid, they send it to a collection agency, and it shows up on your credit report. Sometimes, there are simply mistakes that are on your credit, or late payments that you didn’t realize were reported. If we meet early in the process, we can identify those things and fix them to get your credit scores higher. Increasing your credit score will give you better rates when the time comes, saving you money.
There are also circumstances that are completely acceptable, but that must be handled in a particular way in order to qualify for a mortgage. For instance, one client lives with her boyfriend and the boyfriend deposits his check, then takes the cash out of the ATM to give her to deposit into her account to pay the bills. This situation is perfectly legitimate, but to qualify for a mortgage the banks will want to know where the money is coming from, and it’s hard to trace cash deposits. If I learn about this early in the process, I can explain how to handle this scenario so it is acceptable to the bank, giving us one less hurdle to overcome when it comes time to qualify. In this case, the boyfriend should write her a check and she should deposit the check, or he should deposit his check right into her account, giving a clear trail of where the money is coming from.
Another issue that commonly comes up is gift money. Frequently, buyers have family members who are gifting them a portion of the down payment. It is allowed, but there is an acceptable process for showing the gift and tracking it. In order to get an approval, it is important to follow this process. Also, it can affect what mortgage program we use, so again, that’s why it’s important to meet early. We can talk about the gift before it happens and plan it out to avoid hurdles during the approval process.
A friend offered this analogy: when you meet people early in the process it’s like they’re wearing jeans and a t-shirt, and they’re about to go into a job interview. Before doing so, they meet with you and you make them wear a nice suit and tie, or a dress, and prepare them for any curve balls. You get them ready to walk in and nail the interview.
That’s exactly it. I can tidy up the package and put it in a position to get the best product, the best rates, while making the process smoother and less stressful. Let’s get started – call or email me today!
