The road toward home ownership can be a long and windy one, and as you probably know by now, once you’ve found the one you want, you’re still far from the end of that road.
You’re well on your way, though, and your next step is to write an offer—or purchase contract. This is an extremely important part of the process. Not only do you hope to make a fair offer that will be accepted, but here’s something most buyers don’t realize: the seller isn’t the only one you need to worry about; your mortgage lender is also involved in this step, and you don’t want to do anything to compromise the mortgage application.
This doesn’t mean asking nicely or writing “pretty please” on your purchase contract. It does mean keeping these three make-it-or-break-its in mind when it comes time to write that offer:
Sometimes small mistakes can make a big difference, and these can be the most frustrating. Small but critical details on your original loan application must be the same as those on the purchase contract. This means the names, for instance, must be consistent. It sounds obvious, but many people mistakenly change the name (i.e from both spouses to just one), only to compromise their financing.
Timing is everything when it comes to home closings—it matters to the seller, and it matters to your lender. After all, they need enough time to review all documents and make approvals. On your purchase contract, you’re required to state how fast you can close, so you or your broker will have to be in touch with your lender to get an accurate timeline (dont worry, your broker can help with this).
You’ll also need to state how long each stage of due diligence will take; this includes inspection and appraisal, approving seller disclosures, etc. This is another timing aspect that you’ll want to discuss with your lender, so that it’s realistic yet fast enough to keep the seller happy.
It’s fairly common for buyers to request credits from the seller as part of the negotiation process, and these credits help offset some closing costs. If you are seeking credits, your lender will want the request in the form of a contract addendum, and this will have to be approved by the lender before moving forward.
It’s important to note that your mortgage broker and real estate agent will help you with all of these requirements, and that you’re not going to be left navigating these waters alone. But it is good to keep these in mind and to be aware of how meticulousness and diligence go a long way in the successful purchase of a home.
If you’re buying or selling a home in the Boston area and are in need of a mortgage, or have any mortgage-related questions, contact me at any time for advice or help.