Bob Barcelos' Blog
If you're ready to get serious about your home buying journey, one of the first steps is seeing various lenders. As you become more familiar with the process, you'll likely hear the terms preapproval and prequalified mentioned again and again. We'll look at how each letter works and what you should know before approaching a home seller.
Prequalification Vs. Preapproval
The key difference between a preapproval and prequalification is that the preapproval letter is much more involved. With a prequalification, the lender will look at the general state of the buyer's assets before estimating how much home they're likely to afford. Lenders are not diving into the buyer's past, which can make real estate agents wary of accepting prequalification letters.
With a preapproval letter, you're typically asked to provide the following:
Considering the amount of paperwork you need to provide (and the lender needs to process), preapproval letters can take months to generate. On the other hand, a prequalification letter can be procured in little more than 24 hours.
Here are a few facts that can help you know more about what to expect:
Does It Help to Have Both?
Not necessarily. Prequalification letters are generally recommended for homebuyers who may not know for sure if they're ready to buy. It's a general indication of how much money you'll get, which can help you decide if it's enough to get a preapproval letter. If you're in a buyer's market, you may be able to get away with a prequalification. However, it's generally the far less coveted letter that you can have.
A preapproval letter is definitely the best letter you can take to a seller when you're ready to make a bid on a home, but it's important to note that even these letters may fall through. For example, if a major event occurs (e.g., a job loss, etc.) between when your financial institution issued the letter and when you close on the home. Talking to a real estate agent or financial expert can make it easier to navigate it all.
Even higher-end homes need renovation after so many years. Fashions go out of style and things get worn out. If money is not an object and the sky is the limit, you can do beautiful things with a remodel. However, if you are remodeling because you are ready to sell your home, it’s better to keep colors neutral and update carpets and flooring with easy to clean materials that will match several styles and colors. It is easier to sell a home when people can picture their personal items in the house, and they match with the current updated color scheme.
Full Kitchen Update
If it’s been some time since you updated the kitchen, start your remodel project there. Both bamboo flooring and natural stone are popular products that will last and that clean easily. Choose neutral colors if you are selling your home or go bold with your favorite colors if you are updating everything for yourself.
Update the appliances to energy-saving appliances. For a larger kitchen or a kitchen that you will be enlarging, consider a French door fridge with a double freezer drawer and a gas stove with six or eight burners and a double oven. If you must go with electric, consider a stovetop and purchase a double oven that is built into the wall. Add an island that also functions as a bar.
When looking at new cabinets, you might consider upper cabinets that go all the way up to the ceiling. However, keep in mind that the top shelves are harder to reach, especially for people who aren't vertically gifted. Light-colored woods, such as maple, are in and dark-colored woods are out. For the bottom cabinets, choose a set with drawers. Some manufacturers are making cabinets without drawers, which leads to a ton of wasted space and no place to store smaller items. While they may look great, they aren’t the best use of space.
Full Bathroom Update
If your bathrooms are small and cramped, consider enlarging them. Use adjoining closet space or add on to the house so that you can redesign the layout for the bedrooms and bathrooms. If you’re adding on, consider combining two small bedrooms into one large bedroom, den or office space with its own bathroom.
Choose natural stone tiles for the showers. They last for a long time, and if you choose neutral colors or even browns, they’ll match many color schemes and stay in fashion longer. Update the toilets to water-saving, high-pressure flush toilets. Update the vanities to something decorative instead of the typical square vanity with a single sink and cabinet, especially if you are enlarging your bathroom.
Consider adding a stand-alone shower in the master bathroom and adding a jetted tub. Large 5-foot showers with two or even three shower heads are popular. When you choose flooring, go with a natural stone tile that will withstand the humidity better. Add an exhaust fan with heat built into the fan. These are perfect for the winter months when the bathrooms always feel cooler than the rest of the house.
Ready to make your homeownership dream a reality? In some cases, you may need to submit a home offer that surpasses a home seller's initial asking price, and these cases include:
1. You've fallen in love with a house.
Once you've found your dream residence, you'll want to do everything possible to secure this home as quickly as possible. Therefore, if you fall in love with a house, you can submit an offer that exceeds a home seller's initial asking price in the hopes of streamlining the homebuying journey.
Of course, before you submit an offer on any house, it is paramount to understand what differentiates an average home from a great one.
A great residence is one that you can enjoy both now and in the future. It likely will require minimal initial repairs, and as such, will be worth your time and resources.
2. You are facing steep competition.
For homebuyers who are competing for a high-quality residence in a buyer's market, it often pays to submit a home offer that surpasses a homebuyer's initial asking price. By doing so, you can guarantee your offer will stand out from others and boost the likelihood of securing your dream residence.
In a competitive real estate market, there is no need to hesitate to submit an above-average home offer, either.
A home offer that impresses a homebuyer may set the stage for a quick home sale. And if you put your best foot forward with a home offer, you should have no trouble acquiring a terrific residence, regardless of the current housing market's conditions.
3. You have substantial financial resources at your disposal.
A diligent homebuyer may choose to get pre-approved for a home loan. As a result, this homebuyer may be better equipped than others to submit a home offer that is higher than a home seller's initial asking price.
For example, a homebuyer who receives pre-approval for a home loan can start the homebuying journey with a budget in hand. This homebuyer then can check out houses that fall within his or her price range. And after this homebuyer discovers the perfect house, he or she can make an above-average proposal to acquire the residence.
To get pre-approved for a home loan, a homebuyer should meet with multiple lenders. Next, this homebuyer can review various home loan offers and select one that corresponds with his or her finances.
Lastly, if you need extra support during the homebuying journey, it pays to collaborate with a real estate agent.
A real estate agent will help you evaluate a broad array of houses in your city or town. In addition, this housing market professional can help you put together the right offer on a house to ensure you can secure your dream residence in no time at all.
Take the next step to acquire your ideal house – reach out to a local real estate agent today, and you can move closer to finding and purchasing your dream residence.
If plans for selling your home are in the near future, you’re going to want to start strategizing the most cost- and time-effective ways to make your home irresistible to potential buyers. One of the most proven ways of giving your home the edge it needs to stand out from the competition is good photography and attractive staging.
In today’s post, I’m going to share my tips on home staging that can be achieved on a budget and in a short period of time. That way you can focus more time on finding a new home and stop worrying about selling your current one.
Tip 1: Start packing
Before you start worrying about arranging furniture, it’s important to make sure you have a clean slate to work with. Start by packing personal effects into boxes and labeling them accordingly.
Staged homes are homes that look appealing to the widest audience as possible. Having personal reminders, like family photos, trophies, etc., makes it harder for viewers to picture themselves living in the home.
Most of us keep our homes arranged in a way that is convenient to our lives. And. let’s face it--life can be messy. But, when it comes to staging, less is usually more.
Not only will this cleaning process help you reduce clutter and make the home look better for staging, but it will also make your moving process easier since many of your boxes will already be organized and sealed.
Tip 2: Color scheming
Expertly staged homes tend to have one thing in common--a cohesive color scheme. Think of choosing your color scheme like creating an artist’s palette. You want a few colors that compliment one another and that will work together to brighten up your home.
If you have any furniture that appears worn, dated, or that clashes with the scheme of the room, it’s a good idea to place them in storage while you prepare for photographs and visitors.
Tip 3: Decorate sparingly
Now that you’ve packed away your family photos, you might be wondering what to put on the walls in their place. The best answer is often nothing. However, that doesn’t mean the walls need to be completely bare.
For smaller rooms, you can make them appear more spacious with the use of hanging mirrors (just make sure you can’t see yourself in any of those mirrors when you take your photos!).
Tip 4: Don’t forget the outside of your home
The value of curb appeal can’t be overemphasized. The exterior of our homes, along with our yard and driveway, are essentially what we show the world about our lives. Since most home buyers want their house to look nice, fit in with the neighborhood, but have its own unique flair all at the same time. They want to know that your house has that potential.
Furthermore, the driveway and yard are two of the first things people see when they visit. You’ll want to take advantage of this moment by making a good impression.