20
Sep

Counseling Your Clients

How to Coach Home Buyers about the Mortgage Process

 

I know that one of the first things you ask, when working with a new client, is if they need a mortgage to buy a home—and if they have been pre-approved for a mortgage.

If they have not been pre-approved, I'm sure you recommend that they talk to a lender (hopefully me your favorite mortgage guy) to make sure they qualify and at what loan amount. 

However, not everyone will take your advice. 

So, I wanted to share some client “scripts” that you can use that outline some of the things that lenders require.

And if you feel uncomfortable providing this information, think of this this way—it’s your commission on the line if you sell them a home and, in the end, they don’t qualify for the mortgage loan.

  • Have you checked your credit score? – One of the reasons to check your credit and your score BEFORE talking to a lender is to make sure all the information is correct. It also gives you a chance to increase your credit score because the lower your credit score, the higher your interest rate will be.
  • Do you know where your down payment and closing costs will be coming from? Lenders need to verify that you not only have the money to close your loan, but that you have money left over (called cash reserves) after you have signed the paperwork. So, you need to keep bank statements for at least 2 to 3 months. If you are getting a gift from a relative, certain rules apply and you will definitely NEED to talk with a lender. 
  • Do you have a steady job or income? The loan officer will want to make sure that you have income coming in monthly to make the mortgage payments. You will usually need to provide them with paycheck stubs or investment statements showing a history of income being received. If you are self-employed, tax returns and income statements will be required. 
  • Why get pre-approved for a mortgage? There is a difference betweenpreapproved and being prequalified. A pre-approved means that your credit has been checked and that you have the income to buy the home. The preapproval letter is one of the advantages that you have over other buyers—especially if you get into a bidding war with other home buyers. 
  • Don’t stretch your budget – A mortgage payment that takes most of your paycheck can leave you strapped for cash. You may not have enough money to make repairs, have fun or for future savings.

The scripts are an easy way to advise your homebuyers without being intrusive. Please call so I can help pre-approve your homebuyers. 

Jeffery L. Carter

NMLS 230738 Office: 785-650-4727 Mobile: 785-650-4727

Your Favorite Mortgage Guy

205 E 7th
Hays, KS 67601
785-650-4727

Contact Me Today

Let's find you the right home at the right price.