Tag Archive for: Local Pre-Approval

Calculating mortgage interest rates and payments

Six Ways to Increase Your Mortgage Pre-Approval Amount

Having a larger loan can open up a world of possibilities for those looking to buy a house. So, how do you increase your mortgage pre-approval amount? This article will dive into six effective ways to help you achieve just that.

Whether you’re a first-time homebuyer or looking to make an upgrade, these steps provide valuable insights to optimize your financial position and secure a higher pre-approval amount. From improving your credit score to exploring various loan requirements, each step is designed to empower you with the knowledge and strategies needed to navigate the mortgage pre-approval process successfully.

1. Improve Credit Score

Maintaining a healthy credit score is crucial for securing a higher mortgage pre-approval amount. Your credit score significantly influences the loan you qualify for when purchasing a home. Understanding the factors affecting your credit score and taking proactive steps to improve it can enhance your chances of obtaining a larger pre-approval amount.

Payment history and credit utilization are key determinants of your credit score. Timely bill payments demonstrate reliability to lenders while keeping credit card balances below 30% of your credit limit can improve your credit utilization ratio. Setting up automatic payments and regularly monitoring balances can help maintain a low utilization rate and positively impact your credit score, thus increasing your pre-approval amount. Additionally, checking your credit report for errors and disputing inaccuracies can rectify any issues dragging down your credit score. If you spot errors, such as incorrect account information or unauthorized transactions, follow the appropriate procedures to dispute these inaccuracies.

2. Increase Income and Savings

Expanding your income sources can significantly bolster your financial profile and elevate your mortgage pre-approval amount. Beyond your primary job, consider overlooked sources such as alimony, child support, disability income, Department of Veterans Affairs (VA) benefits, retirement benefits, etc.

Consider exploring avenues like freelancing gigs, part-time jobs, or investments that can provide a stable and reliable cash flow, reinforcing your position as a credible borrower. Additionally, establishing a strategic savings plan is essential. By allocating a portion of your income to a dedicated savings account, you steadily accumulate funds for a substantial down payment.

3. Reduce Debt-to-Income Ratio

Your Debt-to-Income (DTI) ratio significantly affects your mortgage pre-approval amount. Lenders assess this ratio to gauge your ability to manage monthly payments relative to your income and debts. Lowering your DTI ratio enhances your chances of approval for a larger mortgage. Increasing income and reducing debts simultaneously can lead to a healthier DTI ratio and a higher pre-approval amount.

The ideal DTI ratio for mortgages typically falls below 43% for most conventional loans. This means your total monthly debt payments, including your mortgage payment, should not exceed 43% of your gross monthly income. It’s important to note that the 43% threshold is commonly used as a guideline, and the specific DTI requirements will vary by lender.

4. Make a Larger Down Payment

Putting down a substantial amount, ideally 20% or more, of the home’s purchase price can strengthen your mortgage application. Lenders often view borrowers who can make a larger down payment as more financially stable and responsible. This can lead to better interest rates, lower monthly payments, and increased chances of mortgage approval.

One key advantage of making a larger down payment is the potential to avoid private mortgage insurance (PMI). Typically, borrowers making less than a 20 percent down payment must pay PMI monthly, adding to their overall housing costs. By putting down 20% or more, you can often waive the need for PMI, saving you money in the long run and increasing your purchasing power.

By showing your commitment through a larger down payment, you not only reduce borrowing costs but also demonstrate financial stability and dedication to homeownership. This can strengthen your position in the mortgage application process, potentially securing a higher pre-approval amount.

5. Apply With a Co-Borrower

Considering applying with a co-borrower could significantly impact your mortgage pre-approval amount. When you add a co-borrower to your mortgage application, especially someone with a solid credit history and stable income, you increase the chances of persuading the lender to approve a higher mortgage amount. When combined with yours, the co-borrower’s income boosts the total income that the lender considers when assessing your loan eligibility. Before applying with a Co-Borrower, consider the following:

  • Co-Borrower’s Credit Score: Ensure that your co-borrower has a good credit score, which can positively impact your mortgage application.
  • Co-Borrower’s Income Stability: Check that your co-borrower has a steady income to strengthen your overall financial profile.

6. Explore Various Loan Requirements

When aiming to increase your mortgage pre-approval amount, consider different loan requirements that could impact your borrowing capacity, such as loan type, term length, and affordability. Different loans offer different terms and conditions. For example, conventional loans typically require higher down payments but may have lower interest rates, while FHA loans often have lower down payment requirements but come with mortgage insurance premiums.

Applying for a longer loan term can enhance your likelihood of pre-approval. Opting for an extended term reduces your monthly mortgage payments, potentially boosting lender confidence in approving your application. However, before committing to a longer-term, weigh the pros and cons carefully. While it may increase your pre-approval amount, it also means paying more interest over the life of the loan, so align it with your long-term financial goals.

When applying, be sure to choose a realistic loan amount that fits within the limitations of your financial profile. Assess your affordability by evaluating your monthly budget to determine a comfortable mortgage payment. Consult with a mortgage professional to gain insights into available loan options and make informed decisions that support your financial goals.

Don’t wait to begin this journey toward a seamless homebuying experience. Take proactive steps today to boost your mortgage pre-approval amount and make your homeownership dreams a reality. Getting pre-approved will help you remain on budget and set expectations early on by knowing what you can afford.

First Time Buyer FAQ

Fast Facts About Rural Development Loans (RD Loans)

Rural Development Loans (RD Loans) stand as a beacon of opportunity, offering individuals the chance to immerse themselves in the tranquility of rural living while realizing the dream of homeownership.

Tailored for rural aspirations, RD Loans are specifically crafted to assist those seeking to purchase homes in rural areas. The underlying goal is to foster sustainable communities, providing financial support to individuals opting for settlement in less densely populated regions.

Backing this initiative is the United States Department of Agriculture (USDA). RD Loans fall under the umbrella of a government-backed initiative overseen by the USDA. This association not only ensures a high level of reliability but also instills confidence in both borrowers and lenders, emphasizing the commitment to supporting rural homeownership.

A standout feature of RD Loans is the zero down payment option. This financial advantage eliminates the need for a substantial upfront payment, opening doors for aspiring homeowners facing challenges in accumulating such funds. This feature enhances accessibility to the housing market, making the dream of homeownership more achievable.

Renowned for their flexibility, RD Loans have lenient credit requirements. While credit history is still a consideration, the criteria are generally more forgiving compared to conventional loans. This flexibility broadens the spectrum of individuals who can embark on the homeownership journey, fostering inclusivity in rural living.

Affordable interest rates further distinguish RD Loans. These rates, often more competitive and budget-friendly, contribute to the overall affordability of homeownership. This aligns with the initiative to make rural living an accessible and attractive option for families, supporting the overarching goal of community development.

In conclusion, Rural Development Loans present a unique and advantageous opportunity for aspiring homeowners in rural America. If this resonates with your aspirations, we invite you to reach out to us! Our expertise can guide you through the intricacies of RD Loans, helping you navigate the path to realizing your dream of homeownership in the serene landscapes of rural communities.

Image of a family hanging up an American flag

Government-Backed Mortgages: What are they?

Government-backed mortgages are designed to make homeownership more accessible, particularly for first-time buyers and individuals with limited financial resources. They often feature lower down payment requirements and more flexible credit score guidelines than conventional loans, making them an attractive option for many prospective homebuyers.

Understanding the different types of government-backed mortgages and their benefits can empower individuals to make informed decisions when navigating the home loan process.

Types of Government-Backed Mortgages

A government-backed mortgage is a home loan that is guaranteed or insured by a government agency. When securing a home loan, there are many government-backed mortgage programs for prospective homeowners. These initiatives, supported by the federal government, aim to make homeownership more accessible and affordable.

FHA (Federal Housing Administration) Loans

FHA loans, administered by the Federal Housing Administration, are designed to assist low-to-moderate-income borrowers. The eligibility requirements for FHA loans are often more lenient than traditional mortgages, making them an attractive option for individuals with less-than-perfect credit. FHA loans typically have lower down payment requirements and flexible qualifying criteria.

VA (Veterans Affairs) Loans

VA home loans are a remarkable benefit available to those who have served in the U.S. military. These loans are exclusively offered to veterans, active-duty service members, and eligible surviving spouses. With no down payment requirements and competitive interest rates, VA loans have simplified the process for those who have served our country to achieve homeownership.

USDA (United States Department of Agriculture) Loans

USDA loans, facilitated by the United States Department of Agriculture, aim to promote home ownership in rural areas. The Rural Development loan program under USDA offers favorable terms such as no down payment and competitive interest rates. Eligibility is primarily based on the property’s location and the buyer’s income, opening up opportunities for individuals in eligible areas.

Benefits of Government-Backed Mortgages

Government-backed mortgages mitigate risk for both lenders and borrowers. By supporting lenders, the government reduces potential losses from defaults, establishing a more secure lending environment. This support encourages lenders to extend loans to a broader spectrum of borrowers, including those with less-than-ideal credit profiles or smaller down payments.

However, when considering these benefits, borrowers should be aware of factors like mortgage insurance requirements and eligibility criteria. Overall, these programs contribute to the stability of the housing market and open doors to individuals who might otherwise struggle to secure a mortgage. Let’s explore some of the benefits of each loan type.

FHA Loans:
  • Lower down payment: Allows for a down payment as low as 3.5% of the purchase price.
  • Easier credit qualification: More lenient credit score requirements compared to conventional loans.
  • Higher debt-to-income ratios: Borrowers may qualify for a higher percentage of their income for debt payments.
  • Assumable loans: FHA loans are assumable, meaning that a future buyer can take over the existing loan under certain conditions.
VA Loans:
  • Zero down payment: Eligible veterans and active-duty military personnel can finance 100% of the home’s purchase price without a down payment.
  • No mortgage insurance: VA loans typically don’t require private mortgage insurance (PMI).
  • Competitive interest rates: VA loans often have competitive interest rates compared to conventional loans.
  • Lenient credit requirements: While there is no specific credit score requirement, VA loans generally have more flexible credit standards.
USDA Loans:
  • No down payment: USDA loans offer 100% financing, allowing borrowers to purchase a home without a down payment.
  • Lower interest rates: USDA loans often feature competitive interest rates.
  • Rural property eligibility: USDA loans assist borrowers in rural areas, promoting homeownership in these communities.
  • No mortgage insurance: USDA loans have lower upfront and annual mortgage insurance premiums compared to FHA loans.

Qualifying for a Government-Backed Mortgage

When taking out a government-backed mortgage, meeting the eligibility requirements is crucial. Understanding the factors that influence qualification and the application process can significantly impact your chances of approval.

Credit Score and Financial History

Your credit score and financial history are pivotal in determining your eligibility for a government-backed mortgage. Lenders assess your creditworthiness before approving a mortgage, considering factors such as payment history, credit utilization, and the length of your credit history. To improve your credit score, focus on paying bills on time, keeping credit card balances low, and avoiding new debts.

Debt-to-Income Ratio

The debt-to-income (DTI) ratio is a key determinant in mortgage approval. Lenders evaluate your DTI to ensure you can manage monthly payments alongside existing debts. To improve your DTI, consider paying off existing debts, avoiding major purchases before applying for a mortgage, and increasing your income sources.

Application Process and Documentation

Navigating the application process for a government-backed mortgage involves several steps. You’ll need to gather documentation such as pay stubs, tax returns, and bank statements to provide a comprehensive view of your financial situation. Working closely with mortgage lenders and providing accurate and complete documentation is essential in expediting the application process.

Finance Your Home With Michigan Mortgage

For qualified individuals and families, government-backed mortgages offer the opportunity to achieve the dream of owning a home while benefiting from favorable terms and interest rates.

At Michigan Mortgage, we specialize in navigating the intricacies of government-backed mortgages. Our dedicated team of experts is committed to assisting you in securing the best mortgage that aligns with your unique needs and financial goals. Whether you are a first-time homebuyer or looking to refinance, our comprehensive services cover a spectrum of government-backed loan options, including FHA, VA, and USDA loans. Give us a call to get pre-approved!

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A Comprehensive Checklist Before Making an Offer on a House

Before taking the plunge into homeownership, it’s essential to have a comprehensive checklist in hand that ensures informed decisions throughout the process. This checklist will help you navigate the complexities of buying a house and ensure that you consider all the important factors before making an offer.

Tips to Follow Before Making an Offer on a House

We understand how overwhelming the homebuying process can be. Here are three tips every potential homeowner should keep in mind while following the steps in this checklist.

Don’t Rush Into a Decision: Take ample time to explore all of your options, from evaluating local real estate trends to learning about property taxes and insurance costs associated with owning the house.

Hire Professionals: Hiring qualified professionals, such as real estate attorneys, mortgage lenders, or inspectors, is essential to avoid potential pitfalls later down the line.

Don’t Overspend: Make sure that the final agreed-upon price aligns within the limits defined by your mortgage preapproval. The excitement of buying a home often leads buyers to overextend themselves financially.

Your Ultimate Checklist for Making an Offer on a House

Invest ample time, seek expert advice, and thoroughly assess each aspect. With meticulous planning, you’ll be one step closer to finding your ideal home. This checklist will walk you through the necessary details to make a well-informed and advantageous decision before making an offer on your home.

Get Pre-Approved Before Making an Offer

Getting pre-approved for a mortgage should be the first step in your homebuying process. A pre-approval letter from your lender will give you the upper hand when negotiating with sellers. Plus, it saves you from the heartbreak of falling in love with a house you can’t afford. You’ll need to approach reliable mortgage lenders, providing them with necessary financial documents such as proof of income, credit history, and assets.

Consult with a mortgage lender for estimates on making monthly mortgage payments, considering interest rates and the down payment amount — factor in costs like homeowners association fees (if applicable), property taxes, and home insurance.

Evaluate the Current Real Estate Market

What are the current market conditions? Are homes selling above or below the asking price? How long do these properties linger on the market?

Evaluate real estate trends, including home prices, average time on the market, and selling prices compared to list prices. An experienced real estate agent familiar with your desired location can help you navigate the homebuying process. Choose a licensed agent who knows the area well.

Researching Your Desired Neighborhood

Location is a crucial factor when buying a home. Before you commit to buying your ideal residence, be sure to research the surrounding area and neighborhood. Don’t get stuck in a place where the only food source is an unreliable convenience store or the closest school district is miles away. Here’s what you need to do:

  • Evaluate local school districts
  • Assess proximity to essential amenities
  • Check out area crime rates
  • Compare average house prices

Research the Property History

Before making an offer, it’s essential to get a sense of the background of your potential home. This can be achieved by checking tax records, property appraisers’ records, or court documents.

A key part of due diligence is learning about the house’s history as much as possible. When was it built? When did the current owner buy it? What renovations were done over time? Similarly, consider future plans, too, such as proposed developments nearby, which may influence the property value significantly over time.

Review Seller Disclosures Carefully

Always review seller disclosures carefully before making an offer. Reading the seller disclosures thoroughly will help you avoid any unforeseen issues in the future.

Seller disclosure statements are crucial in revealing potential issues with the property, such as past repairs or known defects. By thoroughly reviewing these documents, you’ll be better equipped to make an informed decision about your prospective home sweet home.

Physically Inspecting Homes Under Consideration

Don’t overlook the crucial step of physically inspecting homes under consideration. Even beautifully staged homes can hide costly flaws.

Importance of Thorough Physical Inspection: A thorough inspection reveals hidden issues like structural damage, outdated systems, and potential mold problems.

What to Look for During Inspection: Pay attention to details like water damage, foundation cracks, and electrical or plumbing issues. Ask questions and request further inspection if needed.

Before making an offer, don’t skip professional home inspections. Hire a professional home inspector after researching the listing price and comparing properties. They’ll uncover potential problems that may affect your decision or negotiation that might be missed by participating parties.

Making Offers & Finalizing Purchase Details

Once pre-approved and familiar with your local housing market, it’s time to make an offer! Armed with a clear budget and knowledge of market trends, you can confidently search for properties that align with your preferences and financial capabilities.

Your agent can help you with this process and negotiate on your behalf. Once your offer is accepted, the closing process awaits, with a home inspection, appraisal, and finalizing your mortgage to get you ready to move into your new home.

Take the First Step, Get Pre-Approved

Cross it off your checklist: get pre-approved before making an offer on a home. At Michigan Mortgage, we offer a swift and simplified pre-approval process. And when it comes to finding a qualified Realtor, our team of experts is here to assist you. We can connect you with vetted Realtors who will provide guidance throughout the entire homebuying process.

What to Do Before You Make an Offer on a House

Before taking the plunge into homeownership, it’s essential to have a comprehensive checklist in hand that ensures informed decisions throughout the process.

This checklist will help you navigate the complexities of buying a house and ensure that you consider all the important factors before making an offer.

Don’t Rush Into a Decision: Take ample time to explore all of your options, from evaluating local real estate trends to learning about property taxes and insurance costs associated with owning the house.

Hire Professionals: Hiring qualified professionals, such as real estate attorneys, mortgage lenders, or inspectors, is essential to avoid potential pitfalls later down the line.  

Don’t Overspend: Make sure that the final agreed-upon price aligns within the limits defined by your mortgage preapproval. The excitement of buying a home often leads buyers to overextend themselves financially.

Your Ultimate Checklist for Making an Offer on a House

Invest ample time, seek expert advice, and thoroughly assess each aspect. With meticulous planning, you’ll be one step closer to finding your ideal home. This checklist will walk you through the necessary details to make a well-informed and advantageous decision before making an offer on your home.

Get Pre-Approved Before Making an Offer

Getting pre-approved for a mortgage should be the first step in your homebuying process. A pre-approval letter from your lender will give you the upper hand when negotiating with sellers. Plus, it saves you from the heartbreak of falling in love with a house you can’t afford. You’ll need to approach reliable mortgage lenders, providing them with necessary financial documents such as proof of income, credit history, and assets.

Consult with a mortgage lender for estimates on making monthly mortgage payments, considering interest rates and the down payment amount—factor in costs like homeowner’s association fees (if applicable), property taxes, and home insurance.

Evaluate the Current Real Estate Market

What are the current market conditions? Are homes selling above or below the asking price? How long do these properties linger on the market?

Evaluate real estate trends, including home prices, average time on the market, and selling prices compared to list prices. An experienced real estate agent familiar with your desired location can help you navigate the homebuying process. Choose a licensed agent who knows the area well.

Researching Your Desired Neighborhood

Location is a crucial factor when buying a home. Before you commit to buying your ideal residence, be sure to research the surrounding area and neighborhood. Don’t get stuck in a place where the only food source is an unreliable convenience store, or the closest school district is miles away.

Before making an offer, it’s essential to get a sense of the background of your potential home. This can be achieved by checking tax records, property appraisers’ records, or court documents.

A key part of due diligence is learning about the house’s history as much as possible. When was it built? When did the current owner buy it? What renovations were done over time? Similarly, consider future plans, too, such as proposed developments nearby, which may influence the property value significantly over time.

At Michigan Mortgage, we offer a swift and simplified pre-approval process. And when it comes to finding a qualified Realtor, our team of experts is here to assist you. We can connect you with vetted Realtors who will provide guidance throughout the entire homebuying process.

Navigating a Seller’s Market: 8 Tips for Homebuyers

The real estate market can be a complex and ever-changing landscape, with shifts between buyer’s and seller’s markets occurring frequently.

In a seller’s market, where demand outweighs supply, buyers often find themselves facing fierce competition and limited options. However, with the right strategies and mindset, you can still secure your dream home without breaking the bank.

Here are eight tips for buyers in a seller’s market.

Get Pre-Approved for a Mortgage. Before you even begin your home search, get pre-approved for a mortgage. This not only gives you a clear understanding of your budget but also demonstrates to sellers that you’re a serious buyer.

Work with a Seasoned Real Estate Agent. An experienced real estate agent is a valuable asset in a competitive market. They have insights, access to off-market listings, and negotiation skills that can give you an edge.

Be Flexible with Your Criteria. While it’s important to know what you want in a home, being too rigid can limit your options. Consider being flexible with minor preferences to increase your chances of finding a suitable property.

Know Your Limits. Set a maximum budget and stick to it. In the heat of a bidding war, it’s easy to get caught up and overspend. Remember, a home is an investment, and it’s important to remain financially prudent.

Offer a Competitive Price. In a seller’s market, lowball offers are unlikely to be successful. Work with your real estate agent to determine a competitive yet reasonable offer that aligns with the market value of the property.

Consider Waiving Contingencies (with Caution). While waiving certain contingencies like home inspection can make your offer more attractive, it comes with risks. Be sure to understand the potential consequences and discuss them with your agent before proceeding.

Stay Informed About the Market. Knowledge is power. Stay updated on the latest market trends, recent sales, and neighborhood developments. This information can guide your decisions and help you make informed offers.

Remain Patient. While the sense of urgency is heightened in a seller’s market, it’s crucial to remain patient. It’s possible that you might face rejection or lose out on a few properties before finding the right one. Stay resilient and positive throughout the process.

In a seller’s market, buyers need to be strategic, well-prepared, and adaptable. By following these tips and working closely with a knowledgeable real estate professional, you can increase your chances of successfully navigating the challenges of a competitive market and finding a home that meets your needs and aspirations.

Remember, persistence pays off, and with the right approach, you’ll soon be unlocking the door to your new home.

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Seven Steps to Get a Mortgage

The day has come that you are ready to start house hunting. Before you dive into the process, there are a few things you need to do before finding the perfect home.

Choose Your Lender
The first step in the mortgage process is choosing a lender. Be sure to choose a lender you can trust, and a local lender is a huge advantage because they have local experience and can provide a more one-on-one approach. Your lender looks out for your interests and provides a variety of loan options to fit your needs.

Get Pre-Approved
Most realtors do not allow you to schedule a home tour without a pre-approval letter. This is why it is a crucial part in the process before you start your search. You will fill out a mortgage application and provide the lender with your financial information, such as your income, assets, and credit score. The lender will then pre-approve you for a loan, which means they will tell you how much you can borrow and at what interest rate.

Find a Property
Once you are pre-approved, you can start looking for your dream home. Your Realtor can help you narrow down current listings in your preferred area. Once you have a list of possible homes, you can start peeking inside. Planning to set up a private tour with your Realtor can be a good option as you are able to ask more in-depth questions and have your realtor share their own options.

Apply for the Loan
You found the perfect home! Now you will formally apply for the loan. This involves providing the lender with additional documentation, such as a purchase agreement and proof of insurance. The process is quite straightforward and if your finances are in order, it should be a simple process since you have already been pre-approved.

Underwriting
One of the last steps in finalizing your loan is having your lender review your application and documentation to make sure you meet the lending criteria. This process is where an underwriter will look over every detail of your application and ensure that there are no missing pieces.

Appraisal
The lender will order an appraisal of the property to ensure that it is worth the amount you are borrowing. If the appraisal comes in over your offer price, you’re all set. However, if the appraisal comes in less than your offer price, you will need to pay for the difference upfront before the purchase finalizes or renegotiate with the seller.

Closing
One last step and the home is yours! Once the lender has approved your loan, you will need to attend a closing. You will sign the loan documents and pay any closing costs. The most important thing is to ensure you have your final costs set aside for closing day.

Buying a House

Five Things You Should Know Before Buying a House

Buying a house is one of the most significant financial decisions people make in their lifetime. Whether it’s your first home or a new property to add to your investment portfolio, purchasing a house requires careful consideration of several factors.

Here are the five things people should know before buying a house.

Know Your Budget

Buying a HouseBefore you start house hunting, it’s crucial to determine how much you can afford to spend on a house. Make sure you factor in all the costs associated with homeownership, such as property taxes, insurance, utilities, and maintenance expenses. You’ll also need to consider your down payment and closing costs. Knowing your budget helps you narrow down your search and ensures you don’t get in over your head with a home you can’t afford.

Location is Key

The location of a property is one of the most important factors to consider when buying a house. The location affects the home’s value, your commute to work, access to amenities, and the quality of the schools. Before you make an offer, research the neighborhood’s crime rates, property values, and proximity to public transportation, shopping centers, and other essential amenities. You’ll also want to consider the property’s proximity to major highways or airports if you travel frequently.

Work with a Local Lender

Local mortgage lenders offer personalized service that can help homebuyers navigate the complex process of obtaining a mortgage. Local lenders are familiar with local market conditions. We know our local neighborhoods, so we know what’s going, what the trends are, and we use that knowledge when helping buyers obtain mortgages. In a competitive market, a pre-approval from a local lender can help your offer stand out among the rest.

Hire a Real Estate Agent

A Real Estate Agent can help guide you through the home buying process, negotiate on your behalf, and offer valuable insights into the local real estate market. A knowledgeable and experienced Real Estate Agent can help you find properties that meet your needs and budget, navigate the home inspection process, and ensure that all the necessary paperwork is completed correctly.

Don’t Skip the Home Inspection

A home inspection is a crucial step in the home buying process. It helps you identify potential issues with the property before you finalize the purchase. A professional home inspector will thoroughly examine the property’s structure, electrical systems, plumbing, and other essential components to ensure everything is in good working condition. If the inspection reveals any problems, you may be able to negotiate with the seller to make repairs or adjust the sale price to account for the necessary fixes.

By knowing your budget, considering the location, hiring a real estate agent, conducting a home inspection, and working with a local lender, you’ll be better equipped to make an informed decision and find the perfect property for your needs.

Home

10 Things to Do Before You Buy a House

Are you ready to start shopping for your first home? Before you begin, take a look at these 10 tips to make your home-buying journey successful!

Few things are as exciting as making a real estate purchase – and few things cause more stress! To help you out, we’ve compiled a list of 10 tips to help you navigate the process of buying your first (or second, or third) home. These won’t just reduce some of the anxiety, they’ll also help you avoid costly mistakes!

10 Tips for New Home-Buyers

  1. Know where and why you want to buy. The answers to these questions will help you understand what factors should be most important in your decision. For example, is your choice of neighborhood determined by your work, being close to family, or just that you fell in love with the area? Is this going to be a starter house that you’ll want to upgrade in a few years, or are you in for the long haul? Clarity here will help you make a purchase that’s in tune with the other parts of your life.
  2. Give yourself a financial health checkup. Start saving and paying off as many outstanding bills as you can. Check your credit report and get any errors removed. If you do this now, you’ll have a better understanding of what your budget really is – and a jumpstart on the mortgage preapproval process.
  3. Research neighborhoods, prices, real estate agents, and mortgage lenders. While the first two are a given, doing your homework on real estate agents and mortgage lenders is just as important.
  4. Plan your budget and down payment. Once you’ve gotten a clear idea of your financial status, figure out how much home you can afford and how much of a down payment you’ll need – and can manage. Hint: Down payment assistance is often available through state and other agencies.
  5. Understand how the mortgage and home-buying process works. We’ve covered this quite a lot in this blog. See our posts on mortgage underwriting and the path to home ownership for more details.
  6. Get pre-approved. We’ve covered mortgage pre-approval and why it’s so important elsewhere in this blog. Suffice it to say that you can make a stronger offer on a home when your mortgage is pre-approved.
  7. Prepare yourself mentally and emotionally. This is a very hot real estate market. Competition is intense, so be prepared to deal with sticker shock and maybe some disappointment if some other buyer beats you to a house. Be flexible and don’t give up. And know that it’s not just you; most home-shoppers are dealing with the same things.
  8. Review mortgage paperwork and requirements. Yes, there are mortgage professionals who will be reviewing these documents. But look them over yourself; not only will you be legally committing yourself to the terms, any mistakes you correct now will mean one fewer potential snag later.
  9. Verify all information in the listing. Make sure the house you are purchasing is all that the sellers claim. Make sure all the features and amenities, all the room sizes, are as advertised.
  10. Get a home inspection. This is different from a home appraisal, which is mostly about verifying the value of the house and any property. A home inspection looks for potentially costly building, health, and safety issues, and you don’t want to skip that.

Finally, remember that the mortgage provider you choose will have a big impact on your decision. Make sure you’re working with one like Michigan Mortgage that will help you explore all your lending options and choose the one that’s right for you!

 

Local Lender

5 Reasons to Choose a Local Mortgage Lender

Buying a home might be the single biggest purchase you make in your life. You want it to go right. That is why the mortgage lender you choose is critical to making sure your homeownership dreams come true and the experience is hassle-free.

Whether you are a first-time buyer needing assistance through the lending process or you are an existing homeowner seeking to refinance or purchase a vacation home, it pays to go with a local lender as opposed to a big-name national bank or brand.

Local LenderHere are 5 reasons to choose a local mortgage lender like Michigan Mortgage.

1. Personalized Service
A local mortgage lender gives you the chance to to work face-to-face with an expert, if need be. The growth of digital mortgages, like our Pro SNAP app, has eliminated the need for as much face-to-face meeting in the past, but as a home buyer it can be reassuring to know that your loan officer is right around the corner as opposed to across the country or overseas.

A local lender gets to know you. Your messages won’t sit in a voicemail box unanswered for weeks on end. With Michigan Mortgage, you’ll get a cell number for your loan officer and can call or text them at a moment’s notice to get your questions answered.

2. Local Expertise
Another advantage of local lenders is their familiarity with local market conditions. We know our local neighborhoods, so we know what’s going, what the trends are, and we use that knowledge when helping buyers obtain mortgages.

For example, a national lender with no roots in the local community may be reluctant to approve a mortgage for an atypical property, such as an original farmhouse on acreage that’s now covered by a subdivision. A local lender like Michigan Mortgage will know the history of the area and the changing demographics and economic trends and may be more comfortable underwriting such a loan.

Local lenders also have their finger on the pulse of the local or regional economy, and have a better sense of the lending risks in the area. What looks to a big lender like a dilapidated section of town might actually be an up-and-coming area where properties re increasing in value. Local lenders will know this.

Local lenders may also be more attractive to some home sellers and real estate agents who want an efficient and timely closing. Reputation matters. In situations where several offers are on the table, having a local, trusted lender could be the difference between closing or not closing.

3. Realtor Relationships
Local lenders invest a lot of time and effort building relationships with local Realtors. Realtors and lenders are the yin and yang of real estate. Michigan Mortgage loan officers are on a first-name basis with most of the real estate agents in their local areas.

Also, with everyone on your team – the Realtor, the lender, you– working in proximity, a closing can happen quickly and without hassle. The final stage of home buying is sometimes the most stressful. Having a unified team that is familiar and comfortable with each other can make the process quick and painless.

4. Varied and Specialized Products
Local lenders have a better understanding of property values and the local economy. When you work with Michigan Mortgage, you’re paired with a licensed loan officer and team of professionals who are experts in your region. Our loan officers help you choose the right type of loan for your circumstance and we keep you updated along the way. We have in-house tools and resources to expedite a loan, ensuring everything is taken care of in a timely manner.

Local lenders are where you’ll find the specialized loans the big lenders won’t bother with. Maybe you want an adjustable-rate mortgage with a 15-year lock? Or you want to buy a vacation property that lacks a furnace? Or you want to buy or refinance a home for less than $100,000, an amount too small to be of interest most lenders? Or you want a jumbo loan?

Local lenders are have more flexibility. Big banks need process large numbers of loan applications. To do that, they have rigid guidelines about who they will and won’t lend to. Big banks are more about volume than customer service.

At Michigan Mortgage, we have been Michigan’s leading MSHDA first-time buyer lender for 6 straight years. We are also a recognized USDA rural development leader.

5. Reliable, Responsive & Flexible
Local lenders are better at closing loans on a timely basis. If the closing of a loan has to be extended by a week, local lenders are more flexible than big banks who have corporate mandates to crank out the volume.

Local lenders, along with local real estate agents, have an incentive to provide you with excellent service because they want you to be a referral source for future business. They stake their reputation on each and every customer.

With a local lenders, you are much closer to the decision makers with the authority to approve your mortgage. You aren’t dealing with a corporate bureaucracy.

Michigan Mortgage loan officers are more likely to get personally involved in qualifying you for a mortgage, as opposed to big banks. Often, it’s a matter of the getting to know you. Perhaps you are self-employed with irregular income. Or you have poor credit due to a financial crisis, but have good income and low debt.

Michigan Mortgage loan officers are better suited to be responsible and flexible for borrowers like these.

At Michigan Mortgage, you will never be just a name or number on a loan application. We manage every step of the mortgage process, from application to underwriting to closing, to make the process easy. We have been financing the American homeownership dream for nearly three decades. We can do the same for you.