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Why Pre-Approval Should Be Your First Step



In many markets across the country, the number of buyers searching for their dream homes greatly
exceeds the number of homes for sale. This has led to a competitive marketplace where buyers
often need to stand out. One way to show you are serious about buying your dream home is to get
pre-qualified or pre-approved for a mortgage before starting your search.

But even if you are in a market that is not as competitive, knowing your budget will give you the
confidence to know if your dream home is within your reach.

Freddie Mac lays out the advantages of pre-approval in the 'My Home' section of their website.

“It’s highly recommended that you work with your lender to get pre-approved before you begin
house hunting. Pre-approval will tell you how much home you can afford and can help you move
faster, and with greater confidence, in competitive markets.”

One of the many advantages of working with a local real estate professional is that many have
relationships with lenders who will be able to help you with this process. Once you have selected a
lender, you will need to fill out their loan application and provide them with important information
regarding “your credit, debt, work history, down payment and residential history.”

Freddie Mac describes the '4 Cs' that help determine the amount you will be qualified to borrow:
Capacity: Your current and future ability to make your payments
Capital or Cash Reserves: The money, savings, and investments you have that can be sold
  quickly for cash
Collateral: The home, or type of home, that you would like to purchase
Credit: Your history of paying bills and other debts on time

Getting pre-approved is one of many steps that will show home sellers that you are serious about
buying and it often helps speed up the process once your offer has been accepted.

Bottom Line
Many potential home buyers overestimate the down payment and credit scores needed to qualify
for a mortgage today. If you are ready and willing to buy, you may be surprised at your ability to do
so as well.




5 Financial Reasons You Should Own Your Own Home


The American Dream of homeownership is alive and well. Recent reports show that the U.S.
 homeownership rate has rebounded from recent lows and is headed in the right direction.

The personal reasons to own differ for each buyer, but there are many basic similarities.
Today we want to talk about the top 5 financial reasons you should own your own home.

1. Homeownership is a Form of Forced Savings

Paying your mortgage each month allows you to build equity in your home that you can tap
into later in life for renovations, to pay off high-interest credit card debt, or even send a child
to college. As a renter, you guarantee that your landlord is the person with that equity.

2. Homeownership Provides Tax Savings

One way to save on taxes is to own your own home. You may be able to deduct your
mortgage interest, property taxes, and profits from selling your home, but make sure to
always check with your accountant first to find out which tax advantages apply to you in
your area.

3. Homeownership Allows You to Lock in Your Monthly Housing Cost


When you purchase your home with a fixed-rate mortgage, you lock in your monthly
housing cost for the next 5, 15, or 30 years. Interest rates remained around 4% all last year,
marking some of the lowest rates in history. The value of your home will continue to rise with inflation, but your monthly costs will not.

4. Buying a Home Is Cheaper Than Renting

According to the latest report from Trulia, it is now 37.4% less expensive to buy a home of
your own than to rent in the U.S. That number varies throughout the country but ranges
from 6.5% cheaper in San Jose, CA to 50.1% cheaper in Detroit, MI.

5. No Other Investment Lets You Live Inside of It

You can choose to invest your money in gold or the stock market, but you will still need
somewhere to live. In a home that you own, you can wake up every morning knowing that
your investment is gaining value while providing you a safe place to live.

Bottom Line
Before you sign another lease, let’s get together to help you better understand all your options. 




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