Property investment companies and those buying a first home are constrained by the same thing, access to money. In today’s economy, after the negative equity fallout, purchasing a property with a home loan or mortgage is more challenging than before, but this is a good thing.
There are cheap homes on the market and it is an ideal time to pick up that bargain property.
First things first, obtain pre-approval – not to be confused with prequalification. The latter is merely a guide to how much you are likely to be able to afford. As a serious purchaser, you will need to go through the approval process at some point. Doing it upfront has a number of distinct advantages and will secure you that discount property.
Credibility and Creditworthiness
Armed with pre-approval, realtors are far more likely to give you their maximum attention. Realtors don’t care whether you are an investment realtor buying investment property or out to buy a first house. They want to make a sale. The same logic applies to the seller. When evaluating your offer or comparing it against others, they want to know if you have the money. ‘Sell my house quickly,’ is all they are thinking. If you were selling your own home, would an approved buyer not be important to you? That document is essential. Leveraging it will get you a better price or at the very least, help you beat another buyer to the sale.
Focus
The key to picking a bargain up is being ready to pounce. Knowing what price range you are approved for, allows you to focus your energy and research in the right place. You will be able to contrast areas, as well as house features in the same price range. Each price bracket performs slightly differently in the market. With some patience, you will become familiar with the average time it takes to sell a property; size and quality for that price tag and so on. To buy a foreclosed home and get maximum value, you need to be informed.
Satisfaction
For many people, the stress involved in buying a house is considerable. This is multiplied when dealing with the disappointment of finding an ideal house and realizing at the finish line that they can’t afford it. Knowing where you stand, eliminates the pressure of uncertainty and removes the risk of disappointment. Pre-approval amounts to confidence. Those making rental property investments can accurately calculate their returns.
To obtain pre-approval all you need to do is contact one of our preferred lenders. There is no obligation to borrow from them, so it makes sense to find a lender suited to your needs. Their rates may also differ slightly. Various financial documents will be required. Typically these include tax returns for 2 years, salary slips, a few months’ bank statements and your employment history. A credit report will be generated so it may be worth finding out what your score is before starting and correcting any outstanding issues such as late or outstanding payments. A little homework beforehand may just save you thousands of dollars over the term of your home loan.
