You’ve been pre-approved! Now what?

You’ve been pre-approved for a mortgage. First of all, congratulations! This is a big step, and an important piece of the homeownership puzzle. Take a moment to enjoy this achievement before considering what your next steps need to be.

Now that you’re ready to move on to the next stage of the home buying process, you may be wondering what to do now. Here are a few things to keep in mind as you move through the process!

Start searching for the right agent

With your pre-approval in hand, you now need to find the right real estate agent. Not all realtors are the same, so it’s important to choose one who is familiar with your area, budget, and housing needs. A real estate agent helps you find suitable properties, arrange showings, submit offers, and negotiate with sellers and their agents. Using an agent saves you a lot of time and stress, not to mention sellers will take you more seriously. Don’t try to buy without an agent, or you could miss out on your dream home and get lost in the paperwork process. In a market this busy, you need every advantage you can get. As brokers, we have contacts with many amazing real estate agents, so feel free to ask us for recommendations!

Begin your house hunt

Searching for a house is probably what you’ve been looking forward to the most. Now, it’s finally time to get cracking on the hunt. Since you’ve been pre-approved, you have a good idea of what you can afford, and what mortgage amount you are most likely to secure. Now, you need to narrow down your location and housing requirements so your agent can find properties that fit your needs. Think about things like the size of the home and yard you want, if you want a rural or urban setting, and if you prefer a detached home or a condo. Your budget will influence some of these decisions for you as well.

Avoid adding to your debt

You can buy a home with existing debt, as long as your lender is aware of the debt and sees you’re making progress in paying it off. If you were pre-approved with debt, you must have shown your income can support it. Now, avoid adding to your debt. Just because you were pre-approved with debt doesn’t mean lenders will finance your mortgage if you come back with thousands of dollars more in debt. Remember, your pre-approval was only applicable to that particular moment in time, and a lender doesn’t have to finance your mortgage if your situation suddenly changes. It’s best to keep your debt levels the same to increase your chances of being approved. This means no extra credit cards or car loans, or any other big purchases that will put you in deeper debt.

Keep your employment the same

Similar to avoiding extra debt and keeping your income the same, you should also maintain your current employment. This means you shouldn’t change your employment and get a new job if it means your income will decrease as a result. You want to do your best to come back to a lender with the same financial situation that you had when you were pre-approved, so they are most likely to finance your mortgage. If you have a lower income, lenders are more likely to question how big of a mortgage you can afford. This might mean you end up with a smaller mortgage, or have to turn to private lenders. These lenders are more flexible but they come with much higher rates.

Find a lender

Now, it’s time to get your final approval from a lender. You don’t have to get a mortgage from the same lender who pre-approved you. You’re free to shop around and look at different lenders without feeling tied to the one you worked with before. Brokers can help find the right lender for you. They have access to a wide variety of lenders, some of whom may not even work with clients who don’t use brokers. Brokers can help determine the product that would suit you, and which lenders might fit your needs best with their products and rates. 

Don’t skip the home inspection

Finally, once you find a home you think you love, make sure to order a home inspection. A home inspection will turn up any problems that may impact your desire to buy it. It will uncover problems with the foundation, the roof, plumbing, or anything else. If you buy a home without an inspection, and it turns out there are tons of issues, you could be paying thousands of dollars to fix them. However, getting an inspection means you can ask the seller to cover the fixes before the sale goes through. It’s common to put an offer on a home with the condition of it passing a home inspection, and most sellers will understand that condition.

Once you’ve been pre-approved, you’re well on your way to owning a home. This is an exciting experience, whether it’s your first home or your fifth. Try to take a moment to enjoy it! As stressful as the process can be, following these steps will help ensure it goes as smoothly as possible. If you need extra guidance, you can get in touch with a mortgage broker to help you along the way.

If you have any questions about buying a property, give us a call at Centum Home Lenders! You can reach us at 506-854-6847, or get in touch with us here.