In this post, we’ll give you our five tips of what to do before you jump into the real estate market, and what to do if you must relocate.
Tip #1: Get Your Finances in Order
Make a spreadsheet of your income, debts, monthly expenses, and check your credit score! More than anything, your credit score will determine what interest rate your mortgage lender can offer.
The higher your credit score, the better the interest rate. Read our post entitled, “This More Than Anything Affects Your Ability to Buy a Home” to dig deeper.
If your credit score is not good, consider holding off buying a home until you can resolve your credit issues.
There’s no need to pay more in interest if you don’t have to! Clean up your credit first to get a lower interest rate.
Tip #2: Get Loan Pre-Approval First
There are two ways you can enter the real estate market as a credible buyer. Choosing to get pre-qualified or to get pre-approved for a mortgage.
Which one is best? The latter, by far. Loan pre-approval is assurance to a seller that you are qualified to buy their home.
Pre-qualification is simply your banker giving you an idea of how much house you can afford to buy based on your overall finances.
Mortgage pre-qualification is so simple, it can even be done over the phone or online. Mortgage loan pre-approval is a very involved process that carries far more weight when presenting a contract.
Don’t confuse the two because the seller won’t! The seller will choose the contract that has loan approval.
Tip #3: Partner with a Real Estate Agent
With a good, supportive agent, you can weather the winds of the market without so much stress.
Tip #4: Gotta Have vs Nice to Have
We recommend making a list on your phone and keeping it with you when you tour prospective homes.
Tip #5: Look Online and Off
An in-person visit will show you aspects to the property you can’t grasp online. For example, can you really fit your big truck and SUV in the garage?
Bonus Tip: Develop a Contingency Plan
Some options include short selling, that is selling your home for less than the mortgage balance, choosing to be a long distance landlord, geobaching—serve at a duty station while your spouse stays with the home you’ve purchased.
Which one is the right decision? The key is to plan ahead so that you know what you will do if and when you must relocate.
Conclusion
When you’re ready to close on your new home, turn to the pros at Lilly Title & Settlement. We’re obsessed with the legal details of getting you settled into your new home as smoothly as humanly possible.