ELIMINATE THE FEAR OF THE LENDER LOOKING AT YOUR FINANCES
Buyers are usually pretty reluctant to talk to a lender. We know why, but all the reasons are really without justification. Here's the usual list:
- I think I'll qualify for less than I want.
- If they pull my credit report, it will hurt my credit.
- I'll have to send them lots of stuff.
- They're going to do all they can to make sure I don't get the money I need.
- I'm embarrassed I haven't saved enough down payment.
- They'll try to lock me into a loan and I'll have to use them.
Nope. Wrong on all of them. Here's why:
- You'll probably qualify for more. See the page on the sidebar that says Don't Make Your Home a Jail.
- It will not. This is an old myth. It hits it for a point or two for a few weeks, then it is restored. A few points one way or another on a credit score are meaningless.
- Ok, this one is actually true. But be real - you're asking for them to cut a big check - they deserve some effort on your part. Besides that, you can get a ballpark without sending them much of anything. And a ballpark is better than what you have now, which is probably hunches.
- They are going to do their best to get you the money. If they are a bank lender, the officer gets a salary a bit of a commission on each loan they do. If they're a mortgage broker (even better) they ONLY get paid if you get a loan. They work for you and will work hard ot make sure it all happens.
- You and everybody else on the planet. This is not their first day at work. It is likely they've never talked to anyone who has saved as much as they should for a down payment. They are used to this.
- They won't. There is no obligation when you talk to a lender and even if you get a pre-approval from them. You can still shop around and you can use whatever lender you like once it comes time to get the loan.
Talking to a lender early in the process is nothing but an advantage to you. Seriously, I can't count on both hands the number of people who failed to heed this advice, wanted to bid on a home, but could not because their pre-approval was not done yet. Notice I said pre-approval, not pre-qualification. Pre-qualifications are useless. Really - let's help you get started on this step.