How To Get Pre-Qualified or Pre-Approved For a Mortgage (Or Home Loan)

Working closely with a lender is an important part of my business.  I like to stay informed and help my clients understand everything about buying a home.  Many people have heard a lot of real estate terms, but don’t always know what they mean.  I asked a loan officer to help explain the initial qualification process for me.  This is what he had to say about Pre-Qualifing/Pre-Approvals:

This is a touchy topic these days with all the different regulations and laws that have come out. Everyone has to step lightly as to not get in trouble for saying the wrong things that could be taken as misleading or misguiding.


Take for example the words pre-qualification, and pre-approval. As a loan officer, you are not allowed to market a "Pre-Approval" anymore because "Approval" indicates you just approved a person for a specific loan. Although loan officers can issue pre-approvals, it is not allowed on marketing materials because it simply cannot be done correctly until a borrower has picked out a property, and a full loan application has been made.


"Pre-Qualification" simply means to sit down and cover the very basics of getting a loan. This simply means that you are "Qualified" to apply for a mortgage and have high chances of obtaining a mortgage and so this is the lingo they want loan officers to use. This is what realtors and sellers want to see happen before you write an offer on a house. Once you have a letter from a lender they then begin to take you seriously.


This is good for you too. You need to know you qualify for a loan (mortgage) before you buy anyway. And after the process is complete the loan officer can tell you how much money you qualify for, what payment ranges will be, and also a lot more needed information that you might not realize you need to know.


The process usually should take only 10-15 minutes. You can fill out information online, over the phone, or in person. Most people love a in person meeting at their place of business because of fraud these days. 


What information a loan officer will need during the pre-qualification is your rough estimated income (gross- not after taxes!) to see what debt to income ratios you are at. He then talks to you about your overall credit situation, and then other details associated with each individual that may effect things like if you have any money to put down, etc. Every transaction is different and it is best at this point to be very open and give all the information you can.


After you sit and talk, your loan officer should be able to tell you what loan programs you qualify for or if there are any challenges you need to overcome before looking for a home. But, if you do qualify, your loan officer should issue a letter for you to give to your realtor to put an offer in on a home you love!

If you want to do this, contact David:

David DuBeau – Loan Officer

Sterling Savings Bank

541-292-9663

541-608-2161

www.DavidDuBeau.net

Once you're pre-approved, "Let's Go Shopping!"   Shopping for a home has never been easier.  I can send you information via email so you can preview many homes from your computer.  Then, you can select which ones that best fit your criteria and then we see those in person.   We can have you in a home sometimes in less than 30 days.

For a list of properties, give me a call:

Cheryl Malone – Real Estate Broker

Windermere Investors Marketplace

541-951-1960

www.CherylMalone.com

Remember, the first step in buying a home is to get pre-qualified on a home loan! 

Sellers do not like to deal with buyers who might not qualify. There are plenty of different options out there (even up to 100% financing). 

So get the best Realtor / Real Estate Agent and Loan Officer in Medford and the Rogue Valley working for you today.

Investment Property - It's A Great Deal - Invest In Your Future

If you are thinking about investing in rental property... now is the time.  In addition to purchasing a home for your primary residence, one should consider purchasing a rental property too.  It is not as scary as it might seem. 

Once you have decided that this might be an option, you should contact a local realtor in your area to find out what kind of property would best suit your needs.  Some people prefer an apartment building (2+ units) and some prefer a single family residence.  After deciding on which type of property you feel most comfortable with (they each have an advantage), ask your realtor to refer you to a property management company that is reliable.  Set up an appointment and interview several to get a feel for what services they offer.

Single family homes are nice because you have only one tenant to deal with.  These tenants seem to have a sense of "pride of ownership" and may take better care of your property (although that is not always the case!).  Multifamily units (2 or more units) can have more of a turnover, but when you do have a tenant move, the loss of rent is a fraction of what it would be on a single family home.  Ask your property managerand Realtor what they have experienced in your area.

According to AXIOMetrics, an apartment market research firm in Dallas, said last year was one of the best periods for landlords over the past 15 years and may mark a turning point in the short term.  With supply in demand, rental properties are a good investment.

You can manage the property yourself, if you feel comfortable doing so... keep in mind that you must know the local rental laws and codes in your area.  If you prefer, you can hire a property management company and they will handle everything for you for a monthly fee.

I have had many, many years managing rental property for myself and others.  It can be a very rewarding experience, if handled right.  Other advantages include tax deductions and appreciation on the value of the property.

If you have any questions or think you would like to take the plunge... give me a call.

Cheryl Malone

541-951-1960

Check out my other blogs:
www.sellingoregonhomes.blogspot.com

Invest In Your Future Now ... Will Social Security Be There For You?

Are you relying on Social Security as a source of income in your "golden years"?  Most people are expecting their Social Security to support them or help support them when they are ready to retire. 

I am looking at my Social Security Statement from February 2010 right now and there is a very interesting part of this statement that I am not sure you are aware of.

It states: "Your estimated benefits are based on current law.  Congress has made changes to the law in the past and can do so at any time.  The law governing benefit amounts may change because, by 2037, the payroll taxes collected will be enough to pay only about 76 percent of scheduled benefits"

Well, what does that mean exactly... not sure, but I don't think I can really count on Social Security being there for me.  Gee, congress can make changes to the law any time - that is reassuring. 

So lets say you were suppose to get $1,000 a month, now you are getting $760... hmmm I could have done a lot with that extra $240.

I feel that real estate is a very good investment, if you look at it long term.  If you are renting now, you should buy yourself a little home - just to get your foot in the door.  If you currently own a home you can buy yourself a little house to rent out - over the years it would go up in value and your loan balance will decrease.  When you need some additional income to live on in 25 years, it will be almost paid off.  This could be your nest egg. You can refinance and pull your money out or just sell it. 

I like to think of this type of thing as "the investment that keeps on giving".  If you refinance and take some money out to live on, you still have the property... you can then leave it to your kids when you pass away or you can refinance several times throughout the years.  Hence, the investment that keeps on giving.

This type of small investment is easy to manage.  There are many options.  I have years of experience with property management and can help guide you through the process.  Think about your future, Social Security isn't.

Call me and I can get you started.

Cheryl Malone
541-951-1960

Here are some other blogs I wrote:

http://sellingoregonhomes.blogspot.com/2011/02/so-you-want-to-own-rental-why-not-buy.html

http://sellingoregonhomes.blogspot.com/2011/02/rent-vs-own-should-i-buy-house-in.html