How do I finance a home?
If this is your first time purchasing a home in the Sandpoint Idaho area we want you to fill comfortable about obtaining financing and applying for a home loan. It's quite simple but can be detailed and stressful if you're not sure of the process.
Before you even look at homes make sure you sit down with the lender and get preapproved for a home loan. This is more than just taking a quiz online and getting qualified for mortgage payment. This is the actual process of going through a home loan application with the lender or mortgage broker. They will go over all of your finances, credit reports, income and debts to determine the best price range that your budget can comfortably handle.
Get a preapproval letter
Make sure you ask your lender for a preapproval letter stating that you have already applied for home loan and can afford the home you're offering on. The lender can even customize this letter to state that you are approved for exactly how much are offering him home.
Don't make any large purchases
Between the time you apply for a home loan and the closing of your house try not to make any large purchases that may affect your credit rating. There's nothing worse than being accepted for a home loan, going through the entire process, only to find out a closing that something you have done has affected your credit negatively and you can no longer purchase the home. This would mean not financing any large purchase or appliance and certainly not buying a car during this time.
If you can't afford a home right now
If the lender says that you are unable to afford a home at this time ask for a strategic plan to get yourself in a better financial situation within six months to a year. Ask what steps he you need to take so that within a few months you are able to apply for home loan and be accepted.
Be smart about your price range
Just because the lender states a maximum amount of home you can afford doesn't mean you absolutely have to purchase a home at that price. Keep some flexibility in your budget by setting your personal maximum $10-$20,000 less than the lenders maximum.