Home > Blogs > E. Lee Smith's Blog
1,771 views

E. Lee Smith's Blog

By E. Lee Smith | Mortgage Broker
or Lender in Austin, TX
  • Pre-Qualification or Pre-Approval?

    Posted Under: Market Conditions in Texas, Home Buying in Texas, Financing in Texas  |  February 8, 2014 11:28 AM  |  335 views  |  No comments

    The terms "pre-qualification" and "pre-approval" are often used interchangeably. Ultimately, being pre-approved for a home loan is the way to go, but first let's take a look at pre-qualification. Here is how pre-qualification works. You call up a mortgage professional and provide your basic financial information including: annual income, years of employment, debts, money available for down payment, credit status and other financial details. The pre-qualification process is very informal. Your mortgage professional will take your word that the information you provide is correct and that there are no omissions of important information. There is very little objective verification during the pre-qualification process; the pre-qualification is based on your word and the information contained in your credit file, that's it. Because the majority of information is not actually verified, pre-qualification is not worth a lot. In fact, a lot of the best real estate agents refuse to work with clients who are only pre-qualified because the buyer is often disqualified during the home loan application process. It's important to go through the pre-approval process so that your real estate agent and sellers will take you more seriously as a buyer.

    The reason why a pre-qualification can be preferred is a matter of timing. If you're looking to make an offer today, the pre-qualification can be issued within minutes. Often the agent will not want to invest too much time into a potential buyer, without knowing that they have been at least pre-qualified. The trouble with pre-qualification is that the information you provide to the mortgage lender might not hold up as well as you thought that it would. There are many potential problems that can come up through the interview process. The quality of the pre-qualification depends wholly on the quality of questions asked and answered.

    The only way to be reasonably certain that you will be approved for a home loan is to get pre-approved. Pre-approval allows you to shop with confidence, knowing how much house you can afford right at the outset. Even better, a pre-approval letter is solid gold in the real estate business. A seller will be much more likely to accept your offer because they know that you have the ability to obtain the needed financing to make the deal go through.

    Getting pre-approved can also save you money. Here is how it works. With your pre-approval letter in hand, you make an offer on a house that is below asking price. Another buyer offers asking price but that buyer is not pre-approved. The seller's real estate agent encourages the seller to take the lower offer, knowing how often buyers who are not pre-approved are unable to secure financing even though they very much want the home. The seller accepts your offer, and you just saved a few thousand dollars, obtaining the house for less than what another buyer was willing to pay. Pre-approval gives you a status on par with a cash buyer. A pre-approval gives you more negotiating clout.

    So what is entailed in getting pre-approved? Pre-approval differs from pre-qualification in that your financial information is verified by your lender. Your credit is pulled, employment confirmed, and you produce important documents such as pay stubs, W-2 forms and asset documentation. Your application is then submitted to the lender's underwriter for approval. It may take a few extra days, to issue the approval, after documents are submitted but it's worth the time and effort.

    If you are going to finance a home, you are going to have to go through this process anyway, so you may as well get it over with. In addition to knowing exactly how much house you can afford and securing a major negotiating chip, pre-approval also saves you from running around, like a chicken with it's head cut off, trying to gather all of your documents at the last minute, in order to meet the closing deadline. Since there is no cost to you, having a pre-approval really is all upside.

    Please contact me directly, if you have questions or are in need of a pre-approval. I appreciate your time and consideration, for reading this blog and I wish you the best for your home search and financing experience!!

    Thank you and best regards,

    E. Lee Smith 512-948-6550

  • Purchase an Investment property with 10% down, without mortgage insurance!!

    Posted Under: Investment Properties in Texas  |  February 8, 2014 11:24 AM  |  234 views  |  No comments

    How can I do that?
    The answer is easy; purchase a Fannie Mae Owned home that comes with the additional incentive of HomePath Financing.

    A foreclosed property can represent a great opportunity and a good value but a HomePath property can offer even more. HomePath financing, offers investors a 10% down payment, no mortgage insurance, expanded seller contributions, and more.

    Expanded financing opportunities are available for investors who may have existing financed properties to allow mortgages up to a total of 20 financed properties (Fannie Mae owned properties only). The investor may be an LLC or an individual. Currently, a limited number of lenders offer this expanded financing.

    How does it work?
    Visit www.Homepath.com to view available properties. Properties that are eligible for HomePath financing are highlighted with the homePath financing logo. Properties are listed with an initial 15 day "First Look" time period (a time set aside exclusively for owner occupants to view the property). After the First Look, investors can place an online bid, to purchase the property. For bids that are accepted, a minimum of $500 earnest money will be required. Financing is subject to credit and income qualifying, an appraisal is not required.

    How do I get qualified?
    Contact me or a qualified HomePath lender. We can help to guide you through the Pre-Approval process, all the way to closing.

    Good luck with your search & best regards,

    E. Lee Smith
    512-948-6550

  • Is lack of down payment preventing you from buying a home?

    Posted Under: Rental Basics in Pflugerville, Rent vs Buy in Pflugerville, For Rent in Pflugerville  |  November 6, 2013 10:23 AM  |  402 views  |  No comments

    So you want to buy a home but... you don't have enough money saved for a down payment. You're not alone. According to Tulia's American Dream Survey, down payment remains one of the largest obstacles to home ownership, for first time buyers.

    If you want to buy an owner occupied home in Texas, with a maximum purchase price of $260,000, you have a credit score above 640, income below $84,000 annually, and you can meet the qualifying criteria for an FHA loan, you could be eligible for a down payment assistance grant.

    There are multiply agencies like the Texas Department of Housing & Community Affairs, Texas Housing Association and the South East Texas Finance Corporation that can help you to get into a home with little, to no money down. These agencies offer down payment assistance grants that are essentially gifts. The grants are 3%, 4% & 5% of the funded loan amount and are used in conjunction with an FHA loan, which require a minimum 3.5% down payment.

    There is no minimum borrower contribution required and there is a maximum of 6% seller concessions (seller paid closing costs), for these loans. As a savvy buyer, you could use the grant to pay for the down payment, negotiate the seller to pay the closing costs, allowing you to put less than a typical rental-deposit down on your new home.

    Stop throwing your money away on rent! Invest in yourself! Buy an appreciating asset, at historically low (tax deductible) interest rates. With no money down, it will be the greatest investment you could ever make!!!

    There are many programs; some are easier to qualify for than others. Please call or email me today, to discuss which finance options would best fit your needs. I can also help place you with qualified real estate agents, who will help to structure the purchase as highlighted above.

    Thank you for reading and good luck with your home purchase!

    E. Lee Smith

    512-948-6550

  • Are you renting becuase you haven't saved for a down payment?

    Posted Under: Rental Basics in Austin, Rent vs Buy in Austin, Rentals in Austin  |  November 6, 2013 10:20 AM  |  537 views  |  No comments

    So you want to buy a home but... you don't have enough money saved for a down payment. You're not alone. According to Tulia's American Dream Survey, down payment remains one of the largest obstacles to home ownership, for first time buyers.

    If you want to buy an owner occupied home in Texas, with a maximum purchase price of $260,000, you have a credit score above 640, income below $84,000 annually, and you can meet the qualifying criteria for an FHA loan, you could be eligible for a down payment assistance grant.

    There are multiply agencies like the Texas Department of Housing & Community Affairs, Texas Housing Association and the South East Texas Finance Corporation that can help you to get into a home with little, to no money down. These agencies offer down payment assistance grants that are essentially gifts. The grants are 3%, 4% & 5% of the funded loan amount and are used in conjunction with an FHA loan, which require a minimum 3.5% down payment.

    There is no minimum borrower contribution required and there is a maximum of 6% seller concessions (seller paid closing costs), for these loans. As a savvy buyer, you could use the grant to pay for the down payment, negotiate the seller to pay the closing costs, allowing you to put less than a typical rental-deposit down on your new home.

    Stop throwing your money away on rent! Invest in yourself! Buy an appreciating asset, at historically low (tax deductible) interest rates. With no money down, it will be the greatest investment you could ever make!!!

    There are many programs; some are easier to qualify for than others. Please call or email me today, to discuss which finance options would best fit your needs. I can also help place you with qualified real estate agents, who will help to structure the purchase as highlighted above.

    Thank you for reading and good luck with your home purchase!

    E. Lee Smith

    512-948-6550

  • Are you renting becuase you don't have the money for down payment?

    Posted Under: Rental Basics in Round Rock, Rent vs Buy in Round Rock, Rentals in Round Rock  |  November 6, 2013 10:14 AM  |  415 views  |  No comments

    So you want to buy a home but... you don't have enough money saved for a down payment. You're not alone. According to Tulia's American Dream Survey, down payment remains one of the largest obstacles to home ownership, for first time buyers.

    If you want to buy an owner occupied home in Texas, with a maximum purchase price of $260,000, you have a credit score above 640, income below $84,000 annually, and you can meet the qualifying criteria for an FHA loan, you could be eligible for a down payment assistance grant.

    There are multiply agencies like the Texas Department of Housing & Community Affairs, Texas Housing Association and the South East Texas Finance Corporation that can help you to get into a home with little, to no money down. These agencies offer down payment assistance grants that are essentially gifts. The grants are 3%, 4% & 5% of the funded loan amount and are used in conjunction with an FHA loan, which require a minimum 3.5% down payment.

    There is no minimum borrower contribution required and there is a maximum of 6% seller concessions (seller paid closing costs), for these loans. As a savvy buyer, you could use the grant to pay for the down payment, negotiate the seller to pay the closing costs, allowing you to put less than a typical rental-deposit down on your new home.

    Stop throwing your money away on rent! Invest in yourself! Buy an appreciating asset, at historically low (tax deductible) interest rates. With no money down, it will be the greatest investment you could ever make!!!

    There are many programs; some are easier to qualify for than others. Please call or email me today, to discuss which finance options would best fit your needs. I can also help place you with qualified real estate agents, who will help to structure the purchase as highlighted above.

    Thank you for reading and good luck with your home purchase!

    E. Lee Smith

    512-948-6550

  • No Money Down Mortgage in Georgetown, use a Texas Grant!

    Posted Under: General Area in Georgetown, Home Buying in Georgetown, Financing in Georgetown  |  November 5, 2013 3:50 PM  |  407 views  |  No comments

    So you want to buy a home but... you don't have enough money saved for a down payment. You're not alone. According to Tulia's American Dream Survey, down payment remains one of the largest obstacles to home ownership, for first time buyers.

    If you want to buy an owner occupied home in Texas, with a maximum purchase price of $260,000, you have a credit score above 640, income below $84,000 annually, and you can meet the qualifying criteria for an FHA loan, you could be eligible for a down payment assistance grant.

    There are multiply agencies like the Texas Department of Housing & Community Affairs, Texas Housing Association and the South East Texas Finance Corporation that can help you to get into a home with little, to no money down. These agencies offer down payment assistance grants that are essentially gifts. The grants are 3%, 4% & 5% of the funded loan amount and are used in conjunction with an FHA loan, which require a minimum 3.5% down payment.

    There is no minimum borrower contribution required and there is a maximum of 6% seller concessions (seller paid closing costs), for these loans. As a savvy buyer, you could use the grant to pay for the down payment, negotiate the seller to pay the closing costs, allowing you to put less than a typical rental-deposit down on your new home.

    Stop throwing your money away on rent! Invest in yourself! Buy an appreciating asset, at historically low (tax deductible) interest rates. With no money down, it will be the greatest investment you could ever make!!!

    There are many programs; some are easier to qualify for than others. Please call or email me today, to discuss which finance options would best fit your needs. I can also help place you with qualified real estate agents, who will help to structure the purchase as highlighted above.

    Thank you for reading and good luck with your home purchase!

    E. Lee Smith

    512-948-6550

  • No down payment Mortgage in Pflugerville

    Posted Under: General Area in Pflugerville, Home Buying in Pflugerville, Financing in Pflugerville  |  November 5, 2013 3:48 PM  |  408 views  |  No comments

    So you want to buy a home but... you don't have enough money saved for a down payment. You're not alone. According to Tulia's American Dream Survey, down payment remains one of the largest obstacles to home ownership, for first time buyers.

    If you want to buy an owner occupied home in Texas, with a maximum purchase price of $260,000, you have a credit score above 640, income below $84,000 annually, and you can meet the qualifying criteria for an FHA loan, you could be eligible for a down payment assistance grant.

    There are multiply agencies like the Texas Department of Housing & Community Affairs, Texas Housing Association and the South East Texas Finance Corporation that can help you to get into a home with little, to no money down. These agencies offer down payment assistance grants that are essentially gifts. The grants are 3%, 4% & 5% of the funded loan amount and are used in conjunction with an FHA loan, which require a minimum 3.5% down payment.

    There is no minimum borrower contribution required and there is a maximum of 6% seller concessions (seller paid closing costs), for these loans. As a savvy buyer, you could use the grant to pay for the down payment, negotiate the seller to pay the closing costs, allowing you to put less than a typical rental-deposit down on your new home.

    Stop throwing your money away on rent! Invest in yourself! Buy an appreciating asset, at historically low (tax deductible) interest rates. With no money down, it will be the greatest investment you could ever make!!!

    There are many programs; some are easier to qualify for than others. Please call or email me today, to discuss which finance options would best fit your needs. I can also help place you with qualified real estate agents, who will help to structure the purchase as highlighted above.

    Thank you for reading and good luck with your home purchase!

    E. Lee Smith

    512-948-6550

« Read older posts
 
Copyright © 2014 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer