Are You Searching for a Home or Cinderella’s Castle? – Part 1
Buying a home in the internet “Should” be easier than ever. Instead of driving from one open house to the next, you can leisurely look at homes while having your morning coffee. The question is when looking for a home are you realistic and are you searching for a home or Cinderella’s Castle?
With so many websites offering access to listings, it’s easy to get confused. You find a home that looks perfect while standing in line at the Post Office. You get back home and can’t remember which website it was on. You don’t see the same house anywhere. A few days later you find one that looks perfect at an incredible price. You call the “featured” agent next to the listing. That agent has never heard of the house. They’re nice enough to look the address up in the MLS. It isn’t currently listed for sale. The agent checks the history and learns it sold as a short sale three years ago.
No wonder it was such a great price.
You start to feel your dream home is as elusive or non-existent as Cinderella’s Castle. (unless you make a deal with the folks at Disney World) Looking for Cinderella’s Castle could be a fun adventure if you have time and energy to waste. If you need to buy your home now, you may want to take a different approach to your home search.
These steps will help you stop chasing “Cinderella’s Castle” and find the home that’s “just right”.
Establish Your Budget
One of the biggest time drains is looking for a home if you can’t get a mortgage. Today’s lending rules are tighter. Lenders need more documentation than they did a few years ago. Trying to buy a home only to find out that you can’t get a mortgage can be frustrating and embarrassing.
Start by finding a good Mortgage Broker. Ask them to give you a Pre-Approval letter. The Full Pre-Approval will require that they run your credit scores. They’ll need pay stubs, W2s, etc., to document your income. Expect to provide bank statements to verify funds for the down payment. This will take at least a few days, maybe longer if they run into questions.
You can fill out a questionnaire online and get a “Pre-Qualification” in minutes. A pre-qualification letter isn’t worth more than the paper it’s printed on. It’s based on your answers to questions. But the answers haven’t been verified. The Pre-Approval means the lender has verified your answers and they meet underwriting guidelines. You will need that pre-approval when you find the home you want to buy. Most sellers won’t consider an offer that only has a pre-qualification.
Once you have the Pre-Approval letter, you will know how much home you can afford to buy. You’ll need to add homeowner’s insurance, property taxes and HOA fees to the payment. Are you comfortable with that amount? Decide how much you are comfortable spending each month and how much house that buys you.
Searching for Homes in the Wrong Places?
This is where it’s easy to start “looking for big foot”. There are so many websites that allow you to search homes for sale. How do you know which ones are accurate? For starters, look for a local Real Estate website. The big National websites cover every area of the Country. Local websites focus on your local market. Their information is more likely to be up to date and accurate.
This is especially true when looking at Zillow. Zillow’s been criticized for the inaccuracy of their home value “guesstimates” for years. More recently they’ve been criticized about the listings they do or don’t display. Many MLS Boards are now denying Zillow access to their listings. Depending on the MLS in your area, Zillow may or may not have access to your local listings.
Zillow makes money by selling advertising. The more listings they display, the longer they can keep viewers on the site. It isn’t surprising that Zillow continues to show homes that aren’t for sale. What do they care as long as it keeps you looking at homes and clicking on the ads for agents and lenders?
When searching for homes, scroll past the big National sites. Take a look at the sites that belong to local Real Estate agents and Brokerages. Try their home search. Is it easy to use? Does it allow you to save your own search and your favorites? How does the site work on your phone? Finding a site that’s allows you to save your favorites wherever you are is the best. Save the favorite you found while driving around to show the family when you get home. No need to troll through dozens of sites trying to find it again.
Next week we continue with Part 2