Colorado Springs Real Estate and Rentals and Realtor

BACKGROUND

Since entering the Real Estate business in 1996, we have watched our clients struggle through the financing process for the purchase of their home. The financial needs of every client are different, but they are alike in that every buyer wants to have the lowest possible interest rate on their loan and the least amount of "out of pocket" costs to secure their mortgage loan. The buyer also needs the loan to be funded per the contract, on time, at closing.

A successful transaction is a team effort between the Realtors representing each client, the buyer's lender, and the title company. Our business philosophy is to deliver "World-Class" service to our clients but at times we have experienced considerable difficulty fulfilling our commitment when the "buyer's lender" has not shared that philosophy. In other words, our clients want the same good service from all the players that we expect to provide them.

It's important to note taht selecting a good lender can help facilitate your home purchase. Many clients choose questionable lending sources for a multitude of reasons. Too often, these transactions have proven to be unfortunate choices that have cost them "life-altering delays", "excessive cost" and sometimes, the loss of their choice of a "perfect home". This creates problems for us as well because it wastes time and money. Based on our experience, we feel these unfortunate circumstances are the direct result of simply choosing the wrong lender. Contact us if you would like us to refer a good lender.

LOAN PRE-QUALIFICATION

The most important step a prospective homebuyer can take is to determine the amount they can afford to borrow and the type of loan that is appropriate for their situation. The buyer also needs to know how much their monthly payments will be for that loan amount over the period of time in that loan program. Determining this information can be achieved through an analysis of the borrower's personal financial situation, along with a review of past, present and future credit worthiness. This is called loan pre-qualification and in some cases, loan pre-approval.

TIMING

This critical step of loan pre-qualification or pre-approval should be done before looking at any homes and normally, we suggest that this be done not less than two months before you intend to move. This process is also important because the lender provides the buyer and the buyer's agent a pre-qualification letter which is essential when it's time to submit an offer on a home because the seller will want to see that the buyer is qualified before entering into any further negotiations leading to a contract.

WHAT IT COSTS & HOW IT WORKS

There is no cost or obligation associated with pre-qualification. It is a relatively simple and quick process which can usually be done over the phone or by e-mail. The lender will need to know three things: your monthly income, your credit history, and your current debts. Lenders have a formula by which they determine the amount that you qualify to borrow.

PRE-APPROVAL

With interest rates rising, the ability to get pre-approved for a loan ahead of actually finding a specific home, as well as locking in an interest rate for that loan, may be an advantage to the buyer. While pre-approval is not necessary in order to enter into a contract to buy a home, it creates a higher level of certainty for everyone and can save a buyer money if the rate has been locked before interest rates rise. Of course, the rates can go down as well in which case, the buyer would have to go with the higher rate.

FINANCING YOUR HOME