We just got an accepted offer for a house we like. Inspection was done over the weekend, and they noted some open vermiculite insulation (containing asbestos) that we want removed. Aside from that and chimney issues, we are ready to move in.
Well, first we have to get/shop for a mortgage. What are we getting ourselves into? Any tips? Where to get the best rate/deal?
It's a different world for mortgages now. From a brief recall:
1. DO NOT MOVE MONEY AROUND - now they ask for (I can't remember all) but between 6 months and two years financials. Meaning if you money scattered around, don't move it b/c they want to see it where it is. DO NOT MOVE IT
2. Gather all the bank info, stock info, 401K info
3. Don't buy anything. NOTHING to add debt. They will check your income/debt ratio which I believe needs to be under 35%. It's a stupid f'ing ratio as it divides your income by your monthly expenses yet doesn't take the taxes out of your income nor calculate assumed expenses (like groceries, phone, cable, etc). I guess it all evens out. Pay off any debt, if you can.
4. Rates - Just use mortgage broker to shop around for you. Never just go to a bank and listen to their BS. 15 years is better than 30 years but do what you have to do.
5. VERY IMPORTANT - when you decide on your rate see if you can find out who the Underwriter is. Go on linkedin or just call around. The Underwriter is everything. The mortgage broker is worthless and has ZERO pull. They're just the middleman. If you want to walk it through without mayhem get the Underwriter (and the mortgage broker won't give it).
6. Go back to the beginning and get that asbestos issue cleared up b/c you buy health.
I'm surprised you didn't get a pre-approval before paying for an inspection.
for us in Mass, inspection costs $500 (at least) and is paid by the buyer, I wouldn't pay for an inspection without knowing we're approved for a mortgage in the range we offered.
In fact I probably wouldn't put an offer on a house if I needed a mortgage until I knew roughly what I'd be approved for (maybe you do).
definitely. bankrate.com does a good job of comparing many local (and online) lenders in your area and then I'd check credit unions that may not be included.
2) When presented with a list of conditions or required documents from your lender, provide exactly what you are asked for and nothing more. Do not send in what you think should be sufficient - it isn't. Do not send extra documents as they will only cause additional questions and delays for you.
3) Have patience but ask for a timeline of performance expectations.
Good luck!
Lower westchester
no, they're not BS, if you understand what they are. For me as a seller, I'd consider an offer with a pre-approval for a mortgage a stronger offer than one without it. so many home transactions fall apart at the financing, one with a pre-approval can too, but I'm going to say it's less likely.
It really depends. Typically it runs about 2-6 weeks to get a mortgage commitment and then about 2 weeks to get final clearance to close and then you can schedule the closing. These dates run from when your mortgage contact receives the requested documentation from you. Be careful about locking in too early because then you can run into an issue if it takes longer than expected to get approval and clearance
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It means nothing.
no, they're not BS, if you understand what they are. For me as a seller, I'd consider an offer with a pre-approval for a mortgage a stronger offer than one without it. so many home transactions fall apart at the financing, one with a pre-approval can too, but I'm going to say it's less likely.
For some banks pre-approval just means "if everything you told me is true you should be able to qualify for a mortgage." That is why I always put into my contracts if I represent a seller that while the Purchaser is permitted to apply to additional lenders, Purchaser must apply to the lender that provided the pre-approval
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It means nothing.
no, they're not BS, if you understand what they are. For me as a seller, I'd consider an offer with a pre-approval for a mortgage a stronger offer than one without it. so many home transactions fall apart at the financing, one with a pre-approval can too, but I'm going to say it's less likely.
If you have a pulse you're preapproved. It might make you feel better as a seller but it still meaning nothing. It just gives one financial arm the opportunity to approve or decline the buyer. It's all in the hands of the underwriter. That's why I posted to the OP, find the underwriter.
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In comment 12270672 Giants2012 said:
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It means nothing.
no, they're not BS, if you understand what they are. For me as a seller, I'd consider an offer with a pre-approval for a mortgage a stronger offer than one without it. so many home transactions fall apart at the financing, one with a pre-approval can too, but I'm going to say it's less likely.
If you have a pulse you're preapproved. It might make you feel better as a seller but it still meaning nothing. It just gives one financial arm the opportunity to approve or decline the buyer. It's all in the hands of the underwriter. That's why I posted to the OP, find the underwriter.
Maybe pre-sub-prime bubble, but today to be pre-approved requires more than a pulse. It's not an exhaustive investigation like an underwriter would do for the actual mortgage but it's not trivial either. It means something.
Cutting it too close. Never agree to an "on or before" or "time of the essence" closing. Always say "on or about" which gives you 30 days or so so that would give you until July 30 before you get into issues
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Would that be too little time for me to complete the mortgage process?
Cutting it too close. Never agree to an "on or before" or "time of the essence" closing. Always say "on or about" which gives you 30 days or so so that would give you until July 30 before you get into issues
Thank you Mike. Do you mind if I send you an email?
I am in the mortgage business. The time frame on a purchase really is mostly tied to you and your attorney. How quickly do you get all of the docs over to your lender is the most important. They cannot submit the package to the underwriter unless it is all there.
Then, your attorney and/or the title company can also create delays. Often, real estate closings are not on top of an attorney's priority list. I cannot tell you how many times the attorney has created a delay and on occasion it has resulted in the expiration of the rate lock.
So, I would feel comfortable saying refinances within 30 days but purchases a bit longer than that. Get all of your documentation together now so you are not wasting a week doing that.
Anthony does the mortgage and David is an attorney who does the closing. Anthony is in Eastchester and David is Valhalla so you can get to both easily (and probably often).
I worked with both and my mortgage and closing went through like shit through a goose (fast).
Also, who is doing the remediation? If you're going through the Yellow Pages (obsolete reference), I can recommend someone as well as a contractor to do odds and ends or whole room renovations.
I've lived out here for almost 30 years now and know my fair share of studs and hacks. Plus on the contracting side, what town are you in? Knowing the building dept people is almost as important as the contractor you deal with.
My former business partner in the deli now owns a custom wood shop. The work they do is Park Avenue quality for a lower Westchester price.
If you need anything else, lemme know. Being raised with the Italian kids up heah in Hartsdale/Scardale has been a treat and helpful 30 years later.
Good luck, man!!!
Make sure someone goes over the HVAC setup, as well. And remember to place a hardwired CO2 detector down there with battery backup.
I don't mean to be an alarmist, but two things stood out when you posted this. First time buyer and small kids. Kids can get into some weird nooks and crannies in a home so please beware.
As a former real estate agent, I've seen people get their asses handed to them on first deals and have been scarred since. I don't want that for you. Dig? :)
I'm always leary of the ultimatum, "Close by X date or else".
Did you get an estimate for the asbestos remediation? Who is paying for that? Remember, if there is mold, they need to disclose that or they will be subject to serious litigation.
I think that's it. I just finished a quadruple espresso so my mind is racing.
Then again....
It'll cost you a couple of dollars and a minute of your time, but that information is gold when it comes to a home purchase. I've seen things in some files that would make you scratch your head. You'll probably have to fill out a FOIL request (Freedom of Information Law), but that might disclose something a title search wouldn't. A title search will only tell you if a building permit is still open, not all the work permits that were filed.
We are awaiting word on a price quote for the vermiculite (asbestos) abatement. Hope the seller pays for part of it. Hard to play ball in a competitive sellers market
I ll probably need some contacts for legit and good contractors for the pending renovations.
Like i posted, don't just go to a bank. Use a broker. I have seven properties with five (the max by law) under mortgage. I kinda know this stuff pretty well.
If they won't, then find another place.
But this is likely to be the biggest purchase of your life. Don't rush into any part of it.
Get three quotes on the abatement, also. Don't just roll with the first guy, of course.
You're right off Central Ave, I assume? Or closer to Jackson Ave?
But this is likely to be the biggest purchase of your life. Don't rush into any part of it.
Get three quotes on the abatement, also. Don't just roll with the first guy, of course.
You're right off Central Ave, I assume? Or closer to Jackson Ave?
Central Ave