CHAPTER 8 Shopping for a Home Loan or a Home Loan
Shopping for home loans is the "Deal Maker"! You must shop for your home loan. This is the first phase of the home-buying process. DO NOT start looking for a home before you have been pre-approved by the lender of your choice. This is important because you will not be wasting time looking at homes you may not be qualified to purchase. What happens if you start looking at homes before you know what you qualify for can be very disheartening. For instance, you see a great home listed for $500,000 and fall in love with it. However, you qualify for $400,000. There is a big difference between a home that is $500,000 and a home that is $400,000. You have set yourself up for disappointment! Rule Number One: Get pre-approved before you go shopping for a home. By doing this, you will be looking at houses you can afford. You will get a pre-approval letter from your lender, which will presented to the seller when you find your new home. Rule Number Two: Do not be too concerned about interest rates! Be concerned about whether you can afford the house payment. Why is this important? If you can afford the house payment, then you can always refi the home later. This will be explained in this chapter later as you read. Rule Number Three: Research the internet on different types of loans. There are some differences in loans. There are Conventional Loans, FHA loans, and VA loans, and there may be some special loan programs within your state that can assist you in getting a loan. Buying a home puts you into a realm of things you have not dealt 64
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