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What is the most important first step for a buyer?

To get pre-approved by a reputable lender.

Why? First the loan process may contain many pitfalls. Is your credit perfect? Are there any things on your credit report you don’t know about? Are there things on your credit report you need to fix?

Beyond all of that, it sometimes takes a good lender a week or so to check out everything necessary before writing a “Pre Approval” letter. So after a month or so (Sometimes a lot longer than that.) you find the perfect house. It’s a great deal and you want to rush and get your offer in. Only to find they won’t accept offers without a pre approval letter.

You rush to your bank to get it and the lender wants three years of your past tax returns, a pay stub and copies of your bank statements. A few days later your accountant has the paper work and you return to the lender (While the listing agent is accepting another offer.) Your lender now takes your paperwork and processes it and in about a week or two you have a pre approval letter (About now they are resolving home inspection issues on the house you loved/lost.) Depending on how motivated you are and how much you believe me, this can be a fast or slow process.

Would you like to work out any problems found on your credit report when you are in a big rush trying not to lose a home you worked very hard to find? Or do it ahead of time and have time to gather paperwork and maybe even resolve credit issues real or unfortunate at your leasure. Have you ever heard of Human Resources making a mistake or slowing things down?? So the truth is you will know you are dealing with a pro if they won’t do much for you if you aren’t showing them proof of funds or approval.

A mistake, something on your credit report that shouldn’t be there, can take weeks or much longer to remove. Foresight is forearmed.

Now, it’s better to talk to a few lenders and feel them out for how you like dealing with this person, will they return your calls, do they know what they are doing, are their rates competitive? Did a friend or realtor or both recommend this person. Than to rush and make mistakes because you are in a hurry to get a home you love.

So bottom line don’t waste your time doing anything real estate till you have talked to the money. If you want to drive to open houses and dream fine. But if you want to buy one, lender first.

Now you might want to run a free credit report and start dealing with the issues you find. Start saving money so you will have closing costs and some down payment.

Starting with the lender is a real wake up call for most. People come to me all the time and tell me a price range and after I send them to the lender they come back at least $100,000-.  So when they have to go start looking at houses a $100,000- it gets depressing because it was hard finding the one for $100,000 more;-}

So take your time and make each move with knowledge and forethought.

Please let me know how I can improve your day.

Best

Scott

P.S. I should mention anybody can get a pre qualification letter with a phone call. We all know it and so they have no value.  When you submit an offer with any agent to any agent who knows anything, you will need proof of funds (Copy of bank statement.) and a pre approval letter, with no contingencies other than appraisal and title. Anything else will smell bad.