Preparation is essential when faced with a fast moving real estate market, and the San Francisco Bay Area has a pretty swift current!
When I say that you will want to have everything in place before seeing your first home, I mean EVERYTHING. This is not the time to scamper at the last minute and cobble together your paperwork. In the same way that sellers must proactively handle details that could be deal-breakers to prospective buyers, as a prepared BUYER you must look to give the home owner every reason to make it easy to choose YOU as their buyer! When swift action is needed, a realtor practiced in the level of preparation that will both make and SEAL the deal is essential. Today’s real estate market rewards the prepared!
In Today’s Real Estate Market Prepare Before You Start Looking at Homes
- First – Select Your Realtor. You will want to make certain that your real estate agent is exceedingly well-versed and experienced in local real estate markets and highly educated regarding contracts, financing, and pre-approval. Moreover, you will want to choose an agent who values your time! A great Realtor makes the best use of your time via their exceptional knowledge on the inner-workings of various neighborhoods, their help navigating the intricacies of the financing process, and their dedication to keeping a client-centered, eagle-eye on your contract. So, whomever you choose, remember that the best agent for you is one you trust to have your back on ALL of the above!
- Second – Meet with Your Lender and Include Your Realtor! Your real estate agent can be a valuable guide regarding lenders and ultimately act as a “buyer’s advocate” throughout the loan process. When you include your agent in lending phase of the home-buying process, they can make certain the lender steers you in the most optimal direction for YOU, your goals and long/short term vision. They will make sure you ask ALL the important questions and they will hold the big picture for you and help you attend to the occasionally overwhelming number of details.
Five Things You Must Have in Hand in this Real Estate Market
- 2yrs of W2’s – Or 2yrs of tax returns if self employed
- 2mos of Bank Statements (applies to all bank accounts) – You’ll need to account for any recent large deposits (within the past 2 months)
- 2mos of Stock Portfolio/Investment Statements
- Down payment money in hand if liquid or ALL logistics in place and details FULLY worked out regarding your specific plan to sell stock or liquefy other assets
- Renters require 12mo cancelled rent checks or “rent verification form” from property manager
Using Gift Money for a Down Payment on a House
I highly recommend that your lender be involved in making plans for any “gift monies” you might use for your down payment. Because each lender has very specific rules on the matter, your lender can advise you regarding the best way to proceed.
If you do not yet have a lender, an experienced realtor is the perfect place to start. They are familiar with the ins and outs regarding a variety of lenders and have seen the upside, or pitfalls involved with particular ones. If you have not yet chosen your lender, by all means, leverage your realtor’s knowledge and experience!
Have a Backup Plan for Additional Down Payment Money
Speaking of your down payment, your 401K may not be enough! It is always best to have additional financial reserves. This is one time where over-preparation is best. When you are in the running for the home you REALLY WANT, you want to give the seller every opportunity to make it easy Choose YOU as the buyer!
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