- Make sure your credit score is good! A better credit score can mean a difference of tens of thousands of dollars over the life of a mortgage. Have a game plan to clean up your credit score if needed, before starting the pre-approval process. You may discover it’s better for you to wait to buy until you can improve your score.
- Shop around for a mortgage! It can mean a difference of several hundred dollars a month! Talk to different lenders to ensure you get the lowest possible rate, and ask questions about the interest rate, down payment amount, and estimated closing costs, among others. We have great lenders we would be more than happy to connect you with!
- Get pre-approved so you can move fast! Pre-approval means you are approved for full financing and requires a more comprehensive finance and credit check. This differs from pre-qualification which is good for shoppers still figuring out what they can afford.
- Transfer gift or loan money into your bank account NOW! Recent surveys show that 40% of buyers with a mortgage and 52% of first-time homebuyers receive loans or gifts from family and/or friends to help with the down payment. It is important to have that money in your account prior to pre-approval because depending on the size, it could put you into a different monetary bracket.
- Ready-access to that cash factors into your pre-qualification. Factor closing costs into your budget! This is what you pay beyond the down payment. This may include taxes, appraisal fees and homeowners insurance. Preparing for these can limit stress after your home purchase, especially if your offer was at — or over — your budget.
- Write down tradeoffs you’re willing to make ahead of time. Heading into a potential bidding war, it’s prudent to have a clear list of priorities as well as house features that you can live without so that you stay within your budget.
- Narrow your options fast with virtual tours. Homes in a hot sellers market can go under contract in less than a day! The speed of sales are so quick that homebuyers say they would be willing to purchase a home sight-unseen. Get the speed edge over other buyers by previewing homes using virtual or 3D home tours, and take advantage of self-tour options when available.
- Consider an escalation clause in your offer. This is language in your pre-approval letter that ensures your best offer is always in front of the seller. The downside to an escalation clause is you might pay more than you originally intended. To avoid going over budget, shop for homes that are below your maximum price point.
- Work with an agent with extensive local market knowledge. Finding a trusted guide and counselor can be crucial in a competitive environment. An expert local agent can help you understand what makes a winning offer in your area.
With the market being as hot as it is right now, you need a quality agent that is willing to put in the work for you! Gilchrest Platinum Producers agents are ready to battle multiple offer situations to get you into your dream home!