Preapproval First

One thing you should always do is line up the financing and preapproval before you start to look. This way, you know exactly what you can get and save the risk of being disappointed. I run into buyers all the time that call me because they found the house they are looking for and want to write an offer but can’t because they have no idea what they are approved to buy. They get set up with a lender only to find out that they either can’t get approved for it or by the time they get approved for it, someone else has come in and swooped up the house before they could write the offer. They just lost out and are very disappointed.

The type of financing that you are approved for will also dictate the condition of the home that you buy. If you can but 10% or 20% down and go conventional, you will be able to buy a different home than what you could by putting 3.5% down and going FHA or putting “zero” down and going VA. FHA and VA will be much more particular as to the condition of the home and will rule out some foreclosures.