Rochester Real Estate | LOCAL Homes For Sale https://www.rochesterrealestateblog.com Rochester Real Estate | LOCAL Homes For Sale | Homes for sale in Rochester, NY, LOCAL Rochester real estate listings, market data, REALTOR® info, and high quality content updated every 15 minutes! Wed, 25 Jun 2025 11:50:30 +0000 hourly 1 https://wordpress.org/?v=6.7.2 https://www.rochesterrealestateblog.com/wp-content/uploads/2016/11/cropped-SITE-LOGO-512-x-512-1-32x32.png When and Why Should I Get Pre-Approved For A Mortgage? – Rochester Real Estate | LOCAL Homes For Sale https://www.rochesterrealestateblog.com 32 32 June Home Maintenance Checklist: 40+ Must-Do Tasks to Prepare Your Home for Summer https://www.rochesterrealestateblog.com/june-home-maintenance-checklist-summer-prep/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=20501 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> May Home Maintenance Checklist: 30 Essential Tasks to Prepare Your Home for Summer https://www.rochesterrealestateblog.com/may-home-maintenance-checklist/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=20484 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> April Home Maintenance Checklist: How To Prepare Your Rochester NY Home For Spring https://www.rochesterrealestateblog.com/april-home-maintenance-checklist/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=20364 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> March Home Maintenance Checklist: Get Your New York Home Ready for Spring https://www.rochesterrealestateblog.com/march-home-maintenance-checklist/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=20338 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How to Buy a House in New York https://www.rochesterrealestateblog.com/buy-a-house-in-new-york/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19906 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How to Sell a House in New York https://www.rochesterrealestateblog.com/sell-a-house-in-new-york/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19905 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Risks of Buying a Non-Warrantable Condo In New York: What You Need to Know https://www.rochesterrealestateblog.com/non-warrantable-condo/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19796 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What Builders Should Know About Spec Construction Loans In New York https://www.rochesterrealestateblog.com/builders-spec-construction-loans/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19795 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Moving To The Finger Lakes Region Of New York | Guide To Relocating To The Finger Lakes https://www.rochesterrealestateblog.com/moving-to-the-finger-lakes-region/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19875 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Navigating the Numbers: The Pros and Cons of Using Online Home Value Estimators For New York Real Estate https://www.rochesterrealestateblog.com/pros-cons-online-home-value-estimators/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19794 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> The Role of Location in Home Valuation In New York https://www.rochesterrealestateblog.com/role-of-location-home-valuation/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19768 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Lowe’s vs U-Haul: A Review of Truck Rental Companies https://www.rochesterrealestateblog.com/lowes-vs-uhaul/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19758 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Understanding the Importance of a Seller’s Property Condition Disclosure https://www.rochesterrealestateblog.com/property-condition-disclosure-statement/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19632 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What are Delayed Showings and Negotiations in Real Estate In New York? https://www.rochesterrealestateblog.com/delayed-showings-negotiations/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19547 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 8 Viable Tactics to Selling Your Home and Moving Out of State https://www.rochesterrealestateblog.com/selling-home-moving-out-of-state/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19542 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Unconventional Methods for Selling a House: Thinking Outside the Box https://www.rochesterrealestateblog.com/unconventional-methods-for-selling-a-house/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19519 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Should I Sell My House Off Market: Pros and Cons Explained https://www.rochesterrealestateblog.com/sell-house-off-market/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19503 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What is PITI and How Does It Affect Your Mortgage https://www.rochesterrealestateblog.com/what-is-piti/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19498 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How To Set A Home Renovation Budget https://www.rochesterrealestateblog.com/home-renovation-budget/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19490 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How Does A Co-Borrowers Credit Scores Affect A Home Purchase? https://www.rochesterrealestateblog.com/co-borrower-credit-score/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19474 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> New Construction Final Walk-Through Checklist: Ensuring a Seamless Home Inspection https://www.rochesterrealestateblog.com/new-construction-final-walk-through/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19458 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Essential Tips for Pumping a Septic Tank: What You Need to Know https://www.rochesterrealestateblog.com/pumping-a-septic-tank/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19450 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Can You Submit Multiple Offers On Homes At Once – A Legal And Ethical Analysis https://www.rochesterrealestateblog.com/multiple-offers-on-homes-at-once/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19414 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How to Get Your Home Photo Ready for Real Estate Listings https://www.rochesterrealestateblog.com/real-estate-photo-ready/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19409 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What Does a Home Builder’s Warranty Cover? https://www.rochesterrealestateblog.com/home-builders-warranty/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19394 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> July 2023 Greater Rochester NY Area Real Estate Market Update https://www.rochesterrealestateblog.com/july-2023-rochester-ny-real-estate-market-update/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19403 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Who Pays Real Estate Commission When You Buy or Sell a Home https://www.rochesterrealestateblog.com/real-estate-commission/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19366 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Quitclaim Deeds: What You Need to Know https://www.rochesterrealestateblog.com/quitclaim-deeds/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19358 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What to Know About Selling a Home As Is for Cash https://www.rochesterrealestateblog.com/selling-home-as-is-cash/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19347 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How to Know if My House Has Paranormal Activity https://www.rochesterrealestateblog.com/is-my-house-haunted/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19342 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Why Find The History of a House https://www.rochesterrealestateblog.com/find-history-house/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19316 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> June 2023 Greater Rochester NY Area Real Estate Market Update https://www.rochesterrealestateblog.com/june-2023-rochester-ny-area-real-estate-market-update/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19313 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What Does a Real Estate Lawyer Do? https://www.rochesterrealestateblog.com/real-estate-lawyer/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19181 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> May 2023 Greater Rochester NY Area Real Estate Market Update https://www.rochesterrealestateblog.com/may-2023-rochester-ny-area-real-estate-market-update/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19162 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What to Know About Buying a Home For The First Time https://www.rochesterrealestateblog.com/buying-home-first-time/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=19058 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> <strong>What Should a Buyer Look For at a Home Inspection?</strong> https://www.rochesterrealestateblog.com/what-look-for-home-inspection/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18983 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Companies That Buy Houses For Cash Reviewed https://www.rochesterrealestateblog.com/companies-buy-houses-for-cash/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18889 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Does Home Staging Work and What is The Cost? https://www.rochesterrealestateblog.com/does-home-staging-work/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18814 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What to Avoid When Getting a Mortgage https://www.rochesterrealestateblog.com/avoid-when-getting-mortgage/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18797 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> <strong>5 Options For Replacing a Roof Reviewed</strong> https://www.rochesterrealestateblog.com/replacing-roof/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18771 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What Are Restrictive Covenants in Real Estate? https://www.rochesterrealestateblog.com/restrictive-covenants/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18714 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Can The Court Force The Sale of Your House in Divorce? https://www.rochesterrealestateblog.com/court-force-sale-divorce/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18693 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Real Estate Agent vs. Broker: What&#8217;s The Difference? https://www.rochesterrealestateblog.com/real-estate-agent-vs-broker/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18650 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How To Determine Square Feet In Your House For More Accurate Property Estimates https://www.rochesterrealestateblog.com/determine-square-feet/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18167 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 3 Things That Often Results in a Real Estate Agent Getting Sued https://www.rochesterrealestateblog.com/real-estate-agent-sued/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18133 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> The Top 5 Types Of Home Inspections Buyers Should Consider https://www.rochesterrealestateblog.com/5-types-home-inspections/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18119 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> The Pros And Cons Of Rent To Own Homes: What You Need To Know https://www.rochesterrealestateblog.com/pros-cons-rent-own-homes/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18104 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 5 Smart Things To Do Before Moving That Will Help Ease Your Transition https://www.rochesterrealestateblog.com/things-before-moving/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18084 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How to Become a Real Estate Agent https://www.rochesterrealestateblog.com/become-real-estate-agent/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=18071 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Renting A House Or An Apartment: Which Is The Better Option https://www.rochesterrealestateblog.com/renting-house-apartment/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=17871 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> The 5 Most Important Factors To Consider When Buying A House https://www.rochesterrealestateblog.com/5-factors-buying-house/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=17851 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What Buyers And Sellers Need To Know About An Appraisal Gap https://www.rochesterrealestateblog.com/appraisal-gap/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=17827 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Pros And Cons Of Renting With Roommates – What You Need To Know https://www.rochesterrealestateblog.com/renting-with-roommates/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=17794 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 6 Things You Should Know About Buying Land https://www.rochesterrealestateblog.com/things-know-buying-land/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=17773 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How Long Should Home Sellers Wait To Respond To An Offer On Their Home? https://www.rochesterrealestateblog.com/home-sellers-wait-respond-offer/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=17745 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How To Buy A House With A Low Credit Score https://www.rochesterrealestateblog.com/how-to-buy-a-house-with-a-low-credit-score/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=16819 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Things To Consider When Shipping A Car https://www.rochesterrealestateblog.com/things-to-consider-when-shipping-a-car/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=16248 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Home Depot Truck Rentals: What to Know Including Pricing https://www.rochesterrealestateblog.com/home-depot-truck-rentals-what-to-know-including-pricing/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=16156 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 16 Things To Do Before Listing Your Home For Sale https://www.rochesterrealestateblog.com/16-things-to-do-before-listing-your-home-for-sale/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=16138 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> The Biggest Home Inspection Mistakes to Avoid https://www.rochesterrealestateblog.com/biggest-home-inspection-mistakes-to-avoid/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=16112 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How Your Credit Score Impacts Your Ability To Buy A House https://www.rochesterrealestateblog.com/how-credit-score-impacts-buying-house/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=16086 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Top Winter Home Selling Mistakes | 7 Errors Made While Selling A House During The Winter https://www.rochesterrealestateblog.com/top-winter-home-selling-mistakes/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=16051 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Top Winter Home Buying Mistakes | 11 Errors Made While Buying A House During The Winter https://www.rochesterrealestateblog.com/winter-home-buying-mistakes/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=16013 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What Address Change Form Should I Use At The Post Office? https://www.rochesterrealestateblog.com/address-change-form-post-office/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15981 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What Does Contingent Status Mean in Real Estate? https://www.rochesterrealestateblog.com/what-does-contingent-status-mean-real-estate/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15956 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> DIY Renovation Ideas For Your Backyard https://www.rochesterrealestateblog.com/diy-renovation-ideas-backyard/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15937 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How to Rent Your First Apartment Guide https://www.rochesterrealestateblog.com/how-to-rent-an-apartment/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15931 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Tips For Selling A Home Virtually https://www.rochesterrealestateblog.com/tips-selling-a-home-virtually/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15907 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> The Complete Winter Storage Checklist For Your Belongings https://www.rochesterrealestateblog.com/winter-storage-checklist/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15885 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Should I Waive My Home Inspection When Buying A House? https://www.rochesterrealestateblog.com/should-i-waive-my-home-inspection/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15870 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> The Biggest Self Storage Companies Reviewed https://www.rochesterrealestateblog.com/biggest-self-storage-companies/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15836 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Earnest Money and House Deposits Explained https://www.rochesterrealestateblog.com/earnest-money-house-deposits-explained/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15760 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Moving Mistakes To Avoid https://www.rochesterrealestateblog.com/moving-mistakes-to-avoid/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15568 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Top Mortgage Myths | Demystifying Common Home Loan Misconceptions https://www.rochesterrealestateblog.com/top-mortgage-myths/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=15102 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> First-Time Home Buyer Mistakes to Avoid https://www.rochesterrealestateblog.com/first-time-home-buyer-mistakes/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=14815 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 10 Tips For Adding Appeal To Your Home This Summer https://www.rochesterrealestateblog.com/10-tips-adding-appeal-to-home-this-summer/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=14237 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Exploring The Merits of Smart Home Technology When Selling a Home https://www.rochesterrealestateblog.com/smart-home-technology-selling-a-home/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=13782 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Top Frequently Asked Questions From Home Sellers https://www.rochesterrealestateblog.com/top-frequently-asked-questions-home-sellers/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=2424 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> First Time Home Buyer Programs In Rochester NY &#8211; Updated January 2025 https://www.rochesterrealestateblog.com/first-time-home-buyer-programs/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock http://rochesterrealestateblog.com/?p=580 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How New Doors &#038; Windows Can Boost Your Home Value https://www.rochesterrealestateblog.com/how-new-doors-windows-boost-your-home-value/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=13643 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Top 5 Things To Know When Flipping Your First House https://www.rochesterrealestateblog.com/5-things-to-know-when-flipping-your-first-house/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=13574 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What Are The Best Mortgage Options for Self Employed Borrowers? https://www.rochesterrealestateblog.com/mortgage-options-for-self-employed-borrowers/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=13450 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Top 10 Best Places To See Christmas Lights In Rochester NY https://www.rochesterrealestateblog.com/top-10-best-places-see-christmas-lights-rochester-ny/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=10236 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What Are The PROs And CONs Of Multifamily Homes? https://www.rochesterrealestateblog.com/what-are-the-pros-and-cons-of-multifamily-homes/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=13219 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> What Low-Cost Home Improvements Should You Make Before Selling Your Home? https://www.rochesterrealestateblog.com/low-cost-home-improvements-you-should-make-before-selling-your-home/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=13114 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 15 Things Millennial Home Buyers Look At While Buying A House https://www.rochesterrealestateblog.com/15-things-millennial-home-buyers-look-at-while-buying-a-house/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=13028 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How Does A Fence Increase The Value Of Your Home https://www.rochesterrealestateblog.com/how-does-a-fence-increase-the-value-of-your-home/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12995 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 5 Simple &#038; Low Cost Fixes To Make Your Home More Appealing To Buyers https://www.rochesterrealestateblog.com/5-simple-and-low-cost-fixes-to-make-your-home-more-appealing-to-buyers/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12779 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How To Improve A Homes Curb Appeal In Rochester NY https://www.rochesterrealestateblog.com/how-to-improve-a-homes-curb-appeal-rochester-ny/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12665 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 7 Ways to Create an Energy-Efficient Home While Conserving Your Budget https://www.rochesterrealestateblog.com/7-ways-create-an-energy-efficient-home/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12633 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Hiring Movers Vs. Moving Yourself | The PROs &#038; CONs Of Each https://www.rochesterrealestateblog.com/hiring-movers-vs-moving-yourself/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12592 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Should You Pay Off Student Loans Before Purchasing a Home? https://www.rochesterrealestateblog.com/pay-off-student-loans-before-purchasing-a-home/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12531 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Should I Build A New Home Or Buy An Existing Home? https://www.rochesterrealestateblog.com/should-i-build-a-new-home-or-buy-an-existing-home/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=2497 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> Buying A Condo Vs. Renting A Condo | What Are The PROs &#038; CONs? https://www.rochesterrealestateblog.com/buying-a-condo-vs-renting-a-condo/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12402 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 9 Money Saving Moving Tips | How To Cut Costs When Moving https://www.rochesterrealestateblog.com/9-money-saving-moving-tips/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12341 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> How to Create a Proper Home Maintenance Checklist https://www.rochesterrealestateblog.com/how-to-create-a-proper-home-maintenance-checklist/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12300 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> 5 Tips For Tenant Screening | How To Weed Out Bad Tenant Applicants https://www.rochesterrealestateblog.com/tips-for-tenant-screening/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12291 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> The Best Social Media Blogs For Real Estate From 2017 https://www.rochesterrealestateblog.com/best-social-media-blogs-2017/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12045 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> The Best Home Improvement Blogs From 2017 | Advice For Home Remodeling https://www.rochesterrealestateblog.com/best-home-improvement-blogs-2017/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12044 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]> The Best Mortgage Blogs From 2017 | Advice For Home Financing https://www.rochesterrealestateblog.com/best-mortgage-blogs-2017/ Tue, 11 Nov 2014 12:00:32 +0000 Kyle Hiscock https://www.rochesterrealestateblog.com/?p=12043 When & Why It's Important to Have a Mortgage Pre-Approval![/caption] One of the most important steps, and usually the first, during the home buying process is obtaining financing.  There are many different types of mortgages available.  Each mortgage product varies from the amount of money needed down to the acceptable debt-to-income ratios and everything in between.  When buying a home, it's important for a buyer to know for certain, what the best type of mortgage product best suits their needs.  There are even loan programs available for buyers who don't have any money! How do you go about knowing which type of loan is going to be the best for your situation?  The answer is simple, getting pre-approved for a mortgage!  There are many buyers out there who don't understand why it's important to get a pre-approval.  In fact, many of them believe they don't need a mortgage pre-approval before looking at homes.  This is wrong and quite frankly, is one of the top things that buyers do that real estate agents hate.   When and why should you have a pre-approval for a mortgage?  Below is a detailed explanation not only on when you should obtain a mortgage pre-approval but also many reasons why it's extremely important to have one in hand before buying a home. Pre-Approval Versus Pre-Qualification There are some people that believe a pre-approval and a pre-qualification are the same and also some lenders who  use the two interchangeably, they are not.  They are actually very different and it's important to understand what the differences are when buying a home. What is a Pre-Approval? A mortgage pre-approval is when a lender gives their written commitment to a potential borrower.  The mortgage pre-approval process is one in which a lender will obtain from the potential borrower their bank statements, tax returns for the past several years, verify their employment, and pull a tri-merge credit report.  This process does not have to take a substantial amount of time, however, does take a little more time than a pre-qualification, however, the extra time is time well spent. It's important to understand once a mortgage pre-approval is issued, there are still a handful of conditions that must be met before the lender is going to release the funds.  The most common condition in a mortgage pre-approval is that the buyer finds a property and a satisfactory appraisal is done on the property.  This means the subject property must be worth what the buyer and seller agree to and also there are no bank required repairs.  Other possible conditions in a mortgage pre-approval can include an acceptable homeowner insurance binder, continued creditworthiness, and in some cases, depending on the financing, proof of an acceptable home inspection. What is a Pre-Qualification? A mortgage pre-qualification can be best described as a prediction on the amount a buyer can borrow.  In many cases, a pre-qualification is only as good as the piece of paper it is written on.  Many lenders will ask a potential borrower about their incomes, debts, and other assets and use what they are told to issue a pre-qualification.  Some lenders will pull a credit report but some will not.  This often can lead to surprises in the future once a buyer goes to formally apply for their mortgage. When & Why Should You Get Pre-Approved For A Mortgage? The answer to when you should get pre-approved for mortgage is simple, before you begin looking at houses.  As mentioned above, many buyers don't understand why this is important.  Below are several reasons you will be glad you obtained a pre-approval for a mortgage before looking a houses! [caption id="attachment_1684" align="aligncenter" width="425"]Mortgage Pre-Approvals Can Help Eliminate Disappointment! Mortgage Pre-Approvals Can Help Eliminate Disappointment![/caption] Correct Potential Credit Problems It's not unusual for a potential buyer to not know what their credit score is, especially first time buyers.  It's also possible and common that a buyer isn't aware of problems with their credit.  The most common problem with a potential buyers credit is their score.  There are minimum credit score requirements that each lender has for each one of their loan products. Another common credit problem is an error with a buyers credit.  Most people don't monitor their credit report.  It's very possible for a buyer to have an error on their credit that is really not their credit problem.  The process to get errors removed from a credit report can include sending letters to the creditor and the credit bureaus.  It can sometimes take a couple of months for it to get corrected on your report and for your score to be readjusted. Eliminate Disappointment No one likes to be disappointed or a disappointment.  The same goes for someone who is purchasing a home.  Another very important reason why a pre-approval should be obtained before looking at homes is because it can eliminate disappointment.  Unfortunately there are many real estate agents who show houses to a buyer even though they or the buyer, have no clue whether they can afford a home or not.  This is a disservice to a buyer more than anybody else. Why is this a disservice to a buyer?  The fact of the matter is, a buyer can "fall in love" with a home, submit a purchase offer, and find out once they speak with a mortgage lender that they cannot obtain that home due to credit problems or because of other reasons.  This understandably can leave a buyer upset, heartbroken, and disappointed!  This can all be avoided by having a mortgage pre-approval before looking at homes. Understand All Of The Costs To Buying A Home There are many costs associated with buying a home.  It's not as simple as a 3% down payment on a home.  By getting a pre-approval, you will have a very strong understanding what costs you should expect when buying a home, so there are no surprises.  The first thing you will learn when buying a home, is that everybody has to get a "piece of the pie."  Typically when buying a home, you have to pay a full years real estate tax, an entire years homeowners insurance, and many miscellaneous costs. Bottom line, get pre-approved so you have a full understanding how much money you will need to close on your dream home, who you will be paying these costs too, and also why you are paying these costs. Self Employed Or Commission Based Buyers If you are self employed or are considered an independent contractor, getting a pre-approval is extremely important to do before looking at homes.  There are many rules that apply to those who are self employed versus those who are an employee of a company.  Several years back, there were lenders who allowed self employed purchasers to obtain a "no-doc" or no-documentation loan, which allowed a buyer the opportunity to purchase a home without providing all the necessary documentation that is required by lenders now-a-days.  The days of "no-doc" loans are gone.  If you are a self employed buyer, you will need to provide at the very least, 2 years tax returns. Does your income heavily rely on commission?  If so, like a self-employed buyer, there are different requirements that a lender will have.  Often lenders will require 2-3 years proven history showing the commission amounts earned is fairly consistent.  Normally a lender will take the 2-3 years history and average them out.  For example, if a buyer has a sales position and they have a three year commission history of $100,000, $200,000 and $150,000, the will likely use an average expected commission income of $150,000 or less.  A lender wants to be comfortable that the commission income is obtainable, year after year, before approving the loan. [caption id="attachment_1687" align="aligncenter" width="425"]Knock out the competition with a mortgage pre-approval Knock out the competition with a mortgage pre-approval[/caption] Multiple Offers Depending on the real estate market and the time of the year you are looking to purchase a home, it's a strong possibility that a home will have multiple offers.  Another reason to get a pre-approval for a mortgage is the advantage it can give to a buyer when in a multiple offer situation!  A pre-approved buyer is likely to win in a multiple offer situation against a buyer who only has a pre-qualification letter, assuming the majority of the other terms in the purchase contract are fairly similar. Any real estate agent who tells you that a pre-qualification letter is as good as a mortgage pre-approval is not telling the truth or doesn't understand the difference them self!  A great sellers real estate agent is going to advise their client that a pre-approved buyer is a much stronger candidate than a pre-qualified buyer. Recently one of our sellers in Irondequoit, NY had multiple offers on their home.  The pre-approved buyers offer was $1,000 less than the pre-qualified buyers offer, however, the seller ended up selecting the pre-approved buyers offer even though it was less money due to the fact they felt they were more serious about buying a home than the pre-qualified buyer!  This is only one situation when this happened, but it happens more often than most buyers believe, which is why being pre-approved can be the difference between losing or winning in a multiple offer situation. Quicker Closing Real estate transactions generally take 60 days from contract to closing.  The key word being "generally."  One important thing to understand when buying a home is contract dates may not always be met 100% of the time on the target!  A pre-approved buyer will be able to close quicker than a buyer who is pre-qualified. The main reason a quicker closing can happen is because the majority of the background checking has been completed by the lender prior to obtaining an accepted offer on a property.  Once a pre-approved buyer is under contract and any inspections are completed, the lender can order the appraisal on the property.  As a pre-approved buyer, you will have already filled out the mortgage application, given the past few years tax returns, and your credit has been reviewed with a "fine-toothed comb." As you can see, there are many reasons why having a mortgage pre-approval is important and why it should be done before you look at homes.  A great real estate agent should give many of the same above reasons why getting a pre-approval will be beneficial in the long run!  Don't make the mistake that many buyers do, which is not getting their pre-approval in order before looking at homes. Other Mortgage & Home Buyer Related Resources Are you looking to purchase a home in the Greater Rochester, NY area?  We have several mortgage consultants who we'd be glad to recommend you contact for your financing needs.  It's very important when getting a pre-approval, you consider using a local mortgage lender who has a great reputation.  Contact us and we can help you get the ball rolling on your mortgage pre-approval today!
About the authors:  The above article "When and Why Should I Get Pre-Approved For A Mortgage?" was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock).  With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise. We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY. Visit our website at www.HiscockHomes.com.]]>