Hi. I'm Todd Jones and welcome to the Home Buyer Video Series. This is meant to give you some tips and ideas of what it's like to buy a home. You'll find a lot of helpful information here. This is perfect whether you're first time buyer or you've done this several times because let's face it, we don't buy homes every day. You're going to get a whole bunch of great information here.
The first thing I'll like to start off with is the question I get a lot and that is, "Where do I start?" Of course, by this time, you've probably already started to look online whether it's Zillow or Trulia, theMLS, realtor.com, whichever site you like. That's where most people start. But the real place to start is to get pre-approved for a loan, unless you're buying all cash. If you are, you still might want to get pre-approved for a loan because it can leverage your money a lot better. But the place to start is to get pre-approved for a loan.
Now, a lot of people think, "Oh, I know I got that. I have great credit, I have money in the bank, I have a down payment." It doesn't matter, you got to get pre-approved. I can't tell you how many times I've had people get surprised during the approval process. Something showed up on their credit report that they didn't think would be a problem, but it was or maybe something they didn't even know about. Whatever the case, you got to get pre-approved. The right way to do that is to go to a lender, give them all of your information. They're usually going to want two years tax returns, recent pay stubs, bank statements, that sort of thing. If you don't have those things - let's say you're freelance or you do different types of work - that's fine. There are loan programs for people like that as well.
Now, a very important thing regarding getting a loan is not to do things that will affect your credit or your financial liquidity. Don't go out and buy or lease a new car. Don't go out and buy a bunch of furniture that you're going to put in the house. Wait for escrow to close then do those things. Because if you do them before, you might lower your credit score just enough to make you ineligible, or raise the interest, or something like that. The other thing that can happen - and this just happened on a deal - someone co-signed on a lease for someone else, totally blew the deal out. It messed up their ratios and they can't get the loan now. Another thing is, don't deposit cash from some other source and just put it in your bank account. You have to have everything that's traceable because the banks are going to think that's a loan from another source, so they don't want to lend you money and then have you actually owe money to someone else. Even if it's a gift, you have to do it the right way and your loan officer can help you with that.
The pre-approved process is so important, that I believe you shouldn't even go look at homes until you're pre-approved. Let me tell you why, there's a few reasons. Number one, you really don't know what you can afford until you're pre-approved. You may have done some math, you think you know, but until you've had a lender look at your tax returns, your pay stabs, your credit score, your cash on hand, all that sort of thing, you're really not going to know until you get pre-approved. That could also save you a lot of time, you might be looking at properties that are completely out of your price range and start getting that fixation of, "Oh, this is where I'm going to live," and then find out it's totally different.
The other thing is that if you walk into a home and you love it, you're ready to write an offer, but your not pre-approved, you're behind the eight ball. You're going to have to rush each other getting approval done in time - one that the lender really knows that you can buy that house - so that you can get your offer put in. Sometimes if a home is desirable by you, it's probably going to be desirable by someone else. There could be multiple offers on that home as well and if you don't have all of your ducks in a row, you might just miss out on it. It's so important to get pre-approved. I can't stress it enough.
In general, where should I start if I'm buying a home? What do I do? Well, of course, you get pre-approved, you can start looking at properties online, maybe attend a few open houses. Once you see properties that you want to go take a look at inside that you couldn't get into in an open house, you contact your realtor and you go and look at them. Watching these videos will help a lot, I'm telling you. If you watch all these videos, you will know so much more than the average buyer. Now, I don't expect you to retain everything, but it's going to equip you and really give you knowledge so that you can make educated decisions during the process.
I'm sure you've heard that buying a home is a very stressful situation, it's very emotional, one of the hardest things you do in your life. It's true, it can be that way. My goal with these videos is to try to make it as easy and as enjoyable as possible because let's face it, you're going to be living in that home and I want you to enjoy it. These videos are meant to be an overview with the home buying process. Every situation is different, different things come up in every transaction. But by watching these, you're really going to know a lot about what it means to buy a home.
That's it for today. These are meant to be bite size so you don't feel overwhelmed with the home buying process. There will be another video coming into your inbox soon, so be on the lookout for it. If you want to skip ahead, feel free to do that. Just go to my YouTube site listed below.