Custom Home Builder: Getting Pre-qualified.
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We always recommend that our clients get pre-qualified for their loan prior to spending their money on home plans or their home site. Knowing the amount of money you can borrow based upon your income , credit and assets is critical information starting out. Don’t go to the expense of under designing or over designing your new home because you didn’t know your budget limits or capabilities.
Step 1–Select your lender. Finding the right lender can be one of the best things you could ever do, or it could be the WORST!
DONT USE ANY LENDER UNLESS THEY HAVE BEEN RECOMMENDED BY A FRIEND, REALTOR OR NEW HOME BUILDER!!! One of the biggest mistakes I have seen our clients make is to let “slick” marketing entice them into choosing a “loser” lender. Believe me folks if their leading line is “we have the lowest interest rates” then you better start grabbing for your wallet.I have seen many of our customers that have been “sucked in” by these enticing offers only to end up in a nightmare situation. I can’t tell you how many tears I have seen shed on the day of closing because customers have been told by lenders that “everything’s fine” and they end up with a moving truck full of furniture and no home to move into.(If you never listen to one piece of advice in this blog PLEASE LISTEN TO THIS ONE!)
Step 2–Once you have selected your lender they will let you know specifically what they need to pre-qualify you. Be prepared to provide them with:
- 2 years of W2 statements or 1099 income statements
- 2 years of Federal tax returns
- 3 months of bank statements
- Pay stubs or other proof of income
- Proof of investment income