As a mortgage coach I am always trying to get people to set goals and work with them to help them reach them. However it’s easy to dream and set goals but if you never take that all important step of ACTION you will never reach your dream.
The ACTION part of setting goals is not rocket science if your goal is home ownership. But you need a plan of action just like any other plan you set into motion. I think the hardest part is just getting started and knowing where to start. I hope this post clears it up for you.
Here are a few things you will want to know before you get started down that road to home ownership.
Learning the Pros and Cons of renting vs. buying… see my blog post from 2/26/2014 on the subject.
Starting out by getting educated about the process is the best thing you can do. I take special pride and time in educating my clients. Understanding the loan products, guidelines and process will reduce your stress level and you will be better able to choose what is best for you and your family.
Mortgage Coaching is key (it’s all about educating you) and I happen to offer coaching FREE to all my clients, first time buyers or even experienced buyers, things have changed when it comes to all the new loan guidelines and it’s important you know how they will affect getting loan approval.
Everyone is unique and has their own situation, lenders do make exceptions to the rules if you have a good explanation or reason for them to do so. Knowing how to ask for those exceptions is key. That’s why you have me, working for you!
Know how much of a home you can qualify to buy. Why now is the time to start, if you are self-employed it’s critical you know prior to completing your tax return how much money you will need to claim to qualify for a home. Your net income on your SCH-C is what the lender will use as your income. If you have rental properties you’re SCH-E will also be calculated into the equation so any losses will go against any income. If you receive a salary and get W-2’s it’s important to know if your income is enough to qualify. OR you may need to take on more hours or increase your income by making some changes to reach your goal. Knowing what you can afford before you go out shopping for a home is important... you don’t want to get your heart set on a home you can’t afford. Know your price range and stay in it, to avoid going over your budget.
If you have credit issues, remember 80% of American’s have errors on their credit report, checking your credit and running a tri-merge mortgage credit report will tell you exactly what you need to know and if any work needs to be done to clear anything up, that can sometimes take a few months. Get past being embarrassed just about everyone has had issues at some point in their life.
It's doing something about your situation and making changes that is important. YOU can do this!
How much money will you need to pay for your portion of the closing cost, down payment etc.?
Saving money is hard for all of us. Lenders will require you to have some money left over after the close of escrow, in most cases 2 to 3 month of reserves is required. Retirement accounts can be used for this requirement, normally a lender will allow 70% of that type of account to be used as reserves. But getting all this squared away now will help you prepare for what is needed.
Knowing about your options, type of loan, terms and down payment and where you can go for down payment assistance is key. Each state, county and some cities have down payment assistance programs. You will learn from me what is available in your area and how you go about applying for this assistance. In some cases you can get as much as 20% up to a certain purchase price. This allows you to get a regular conventional loan without mortgage insurance (MI) and that will save you a lot of money in the long and short of it, avoiding MI is important if you can. Learning what the best loan is for you and your family will better prepare you for success in your new home. Failure is not an option so getting the right loan is critical.
Getting the year off to a great start can also start with a rock solid budget plan. If you don’t currently work within a budget or even have a plan for a budget, I can help you get started and give you the tools you need that will include a savings plan. I know you are probably saying “right we barely get by now how can we save” BUT if you put a planned budget into play and STICK TO IT, I promise you can and will learn to save. If you never start you will find yourself in the same place this time next year.
ACTION is the most important part of your plan, you have to pick up the phone and call me. If not me then someone else in my industry. Most loan officers will work with you to reach your goals, not all of them have the time, patience and know how to get you from DENIAL to getting that all important status of ELIGIBLE/APPROVED. That status will sound like a song bird singing to you if you had to take the long road to home ownership, but even if you are lucky enough to get a fast APPROVAL it’s a welcome status and one you worked hard to accomplish.
I have a great feeling about 2015, I hope you have great plans for this year too! I look forward to hearing from you. My goal is to put as many families into homes as possible, especially those who didn't think they could do it. That is what makes me happy and warms my heart.
I welcome all inquiries, phone calls and questions. It’s what I do and love! Take a minute to leave a comment and let me know if this blog post or any of my blog posts have helped you. I would really appreciate your input.
Working towards making it an ECO friendly world, have a wonderful and prosperous 2015
ACMC Loan Consultant
Certified Mortgage Coach