Los Angeles home buyers, please remember that lender’s are reevaluating their underwriting criteria constantly.  If your preapproval is more than a month old, please contact your lender and ask them to update it and to inform you of any changes in your ability to qualify for financing.  When you find the home, “the one” you may need to move quickly and you might be competing against other offers. 

If you don’t have a current prequalification letter, phone your lender, before you need it.  If you find the perfect home on Saturday, you may not get the prequalification letter until Monday.

Prior to writing an offer, Natalie and I phone the other Realtor and ask questions:  How long of an escrow period, Escrow and title choices and a variety of other questions.  If we are competing with other offers this information is critical.

When we submit an offer to the Seller’s Agent, our goal is to have the offer accepted immediately.  As more offers can be received while the buyer and seller go back and forth, time can be the buyer’s enemy, in a perfect buyer’s world, our offer is the only offer.  An offer to purchase a home should include the following: 



*Residential Purchase Contract aka “the offer”
*Current Prequalification Letter
*Cover Letter (highlighting the strong points)
*Letter from buyer (if desired)
*Additional documents (Natalie and I call it our secret weapon and don’t ask we can’t tell you, you would have to torture us, it’s what gives our clients the upper hand)

Now a few of my favorite Mortgage Facts sent to my by Floyd Walters, owner of BWA Mortgage: 

Fact #1:  If you are purchasing a home, down payment is important.  In saying that, FHA will actually still do a purchase money loan with 5% down on loan amounts up to $729,750.  Non-FHA lenders need at least 5% down on loans to $417,000 and 10% down and more in many cases.
 
Fact #2:  Credit is important and the higher your FICO score the better of course but you do not have to have "perfect" credit.  Many lenders have a minimum FICO score requirement as low as 620.  The loan will be a little higher in rate and the down payment (or equity) will be a little higher but there are still plenty of financing options.
 
Fact #3:  Monthly payments can still total up to 45% of your income in many cases.  Additionally, with strong compensating factors, Fannie Mae is still accepting even higher ratios than those.
 
Fact #4:  There is no "magic" but there are solutions for most homebuyers and homeowners who are looking to take advantage of today's fantastic rates.  Pick up the phone; talk with your lending professional.  Don't be afraid to explore the options.

If you enjoy Floyd's facts as much as I contact him and ask him to add you to his email newsletter.