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Here are a few homebuying dreams that may need a reality check today.

1. Your dream home will have everything you want

With historically low inventory, the so-called perfect home—if and when it does come on the market—has so many buyers lined up that, even if it started at a “great price,” it will most likely go into a bidding war. So that means it won’t be perfect after all, right?

Having an open mind is key: It’s understandable that you want to avoid a full renovation or a long commute to work, but a willingness to make cosmetic changes or drive even 10 minutes farther than planned will substantially help your cause.

2. There’s time to find a mortgage after you find the house

While house hunting can be fun, finding a mortgage feels more like a chore. Still, if you save the financing step until after you’ve found the perfect home, there’s nary a chance the home will still be available by the time you receive your Loan Qualification Letter.

“Your first call when even thinking about maybe purchasing should be a Home Lender or Loan Officer,” says Darci Fleming with REviron Realty of Yucaipa CA. “They will line everything out and put you in the best position to purchase.”

There are many important reasons why you need to have your mortgage pre-approval before making your first viewing appointment. One, it gives you a guidepost: You might qualify for a larger loan than you thought you would, or in some cases, less. Also, due to COVID-19, many markets have made buyer financial statements a requirement to schedule a showing—and this trend is likely to continue, as it helps sellers separate the looky-loos from the serious buyers.

“If an agent shows you properties without a pre-approval Letter, they probably aren’t the best agent,” says Fleming.

And what happens if you’re just window-shopping, then find a home that checks all your boxes, and you want to make an offer immediately? You can’t submit a competitive offer without your proof of funds and your Loan Qualification Letter and today you are likely to need “all pages” of your DU or Direct Underwritten Approval.

Because interest rates are so low right now, even cash buyers should consider obtaining a pre-qualification just in case they fall in love with a home that exceeds their liquid budget. It’s so easy to call your banker or lender and secure one.

3. The asking price is probably what you’ll pay

The prevalence of bidding wars over the past few years has resulted in a reverse pricing strategy that can be frustrating for real estate agents and buyers alike.

To maximize interest in a property, many seller’s agents have employed a “bargain basement” starting price in anticipation of a bidding war driving up the price.

In some markets, it climbswayup. In high-demand areas, $30,000 to $100,000 above the list price is not unusual. If the cost for a beautifully renovated, spacious home in a fantastic location seems too good to be true, chances are it is.

Edited by Darci Fleming Originally posted on

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