A.D. Cantelmo Property Management Company
Our Business is Property Management in Orange County California
In Real Estate, keeping things in order can make all the difference
I understand that when you go from renting to thinking about
buying a home, the excitement can be overwhelming, but there is an order to the
process that should be followed.
Putting the Cart before the Horse
Too many first time buyers put the cart before the horse and
when you do that, the home buying process can be frustrating at best and
sometimes can end the dream of buying a home all together. I got a call the
other day from a friend and she told me her daughter was thinking about buying
a home. She has been renting and wanted to become a home owner, so she asked me
where she should begin.
Question one
The first question that I asked was, had she talked to a
lender? Her answer was no, so I told her that was the first place to start. She
said that her daughter already knew what she could afford. That is the first
mistake a first time buyer makes. So many buyers, think they know what they can
afford and avoid talking to a lender, but more times than not, they have no
idea what they can afford and they also have no clue about fee’s and property
taxes and so many other aspects that go into buying a home. Until her daughter sat down with a lender the questions stop.
Why a lender should be first
So let’s talk about why a lender should be your first stop.
Why not just guess at what you think you can afford and after you find your
dream home, then talk to a lender? That sounds reasonable, right. NO! I say
that with as much gusto that I can muster. Going about buying a home this way for anyone
especially a first time buyer can be disastrous. Let me give you a hypothetical
example:
You are a first time buyer and are looking for a condo. You
know what area you want to live and you think you can afford a $500,000 home.
You start looking on web sites and may even have a Realtor sending you
properties. You go to open houses and you find a great place. You then tell
your Realtor to write an offer, but now the Realtor ( and if the Realtor has
let you get this far without talking to a lender, they are probably new to Real
Estate themselves), tells you that you need a pre- Approval from a lender in
order for them to write the offer.
You now go to a lender and start the process. You get them
all your information and let them know the amount the home is that you want to purchase.
The lender calls you the next day and tells you that $500,000 is too much and
you can afford a $350,000 home. You are confused and devastated that the home
you have fallen in love with is out of reach. Your searching for the last month
or so has been a waste of time and you not only are upset that you can’t buy
the home of your dreams, but you now are having trouble getting yourself
motivated to start the search for a condo in your price range.
You finally get enough energy to start the process again,
now knowing what you can afford, but still having the condo you fell in love
with in your head. You find that nothing in your price range can compare to
that one condo and eventually you give up.
A very real hypothetical
This scenario may be a hypothetical, but it happens every
day to people who don’t start the process in the right order. If this person in
the example would have talked to a lender first and found out what they could
afford, they would not have fallen in love with a home they could not afford
and their expectations would not have been set so high. Instead of getting
frustrated and eventually giving up, they may have found a very nice place in
the price range they could afford. They would have not been comparing a
$500,000 condo to a $350,000, they would have been comparing $350,000 condos to
$350,000 condos and that way you are not getting your hopes up and then having
them crushed by reality.
Following the process may not seem important at first, but
believe me, it can be the difference between owning a home and renting.
A.D. Cantelmo Property
Management Service Specializes in Property Management in Orange
County Ca.