Some good advice from a friend of mine. Pay attention to the timeline.... Don't lose out on the Tax Credit
At the time I was writing this post we had 69 days and nearly 22 hours left to get those contracts signed and executed. Let me explain - that's almost not enough time.
By the time you, as a home shopper, get approved for a mortgage (should always be the first step unless you truly are paying cash), find the home you are looking for, make an offer, get it back - not including the time it takes to negotiate price if that comes into play, get the inspection and appraisal done and get your loan to closing about 30 days will have passed. That is for a smooth shopping event followed by a smooth loan event.
My company generally closes loans in less than 21 days from contract to close but we rely heavily on many other moving parts including the title company (closing attorney), the appraiser, the seller (if it's a bank add a few to several days to the process), your insurance agent, the appraiser, and you to get everything to us we need. Yes, we can, have and do close faster. Be careful about closing times and what companies call the process. For example from the time we have everything required to close the loan until closing occurs can and has been as little as 2 days. Of course it often takes a week or two to get to that point. That's why we say 21 days from contract to close.
What I am say is if you are planning on taking advantage of the tax credits which have been offered for several months you need to get off your duffus and start making offers.
Step One - Get Pre-Qualified
Now because of some lovely time restraints and new federal regulations you can't really get fully qualified until you have accepted a Good Faith Estimate of Settlement Costs. You can't, legally, get a Good Faith Estimate of Settlement Costs until you have a property address. So while there are some caveats in there until the regulation is rewritten your pre-approval is just that ... pre.
Step Two - Go Shopping
Do NOT go buy a new truck because you just found out your credit is good. Do NOT apply for new credit of ANY kind including store credit down at the MegaLo Mart. You have one purpose in life and that is to find a property that can be financed with the type of loan you are pre-qualified for. This may or may not be a "fixer-upper" and if it is a "fixer-upper" you really are waiting until the last minute.
Step Three - Move Quickly
Don't be the reason your home loan is delayed from being underwritten. Get all of your documents to the lender when they ask for them. Be the person who makes the processor say, "Wow! They had this to me within 10 minutes!" Especially if you are purchasing with an FHA 203k Streamline loan you want to make sure you get started now. If you are using one of the community down payment assistance programs or a USDA rural loan program that will take longer as well.
Take advantage of it NOW because the chances of it being extended yet again are slim to none.
Ken Cook - Georgia - FHA, USDA, VA and Conventional Home Loans (678) 439-8683
