The minute you think you want to buy a house, you need to speak to a lender before anyone else. Go to your local bank, credit union, or if you have a realtor, they should be able to send you some contacts. At the end of the day, it will depend on your debt-to-income ratio and credit score, but lenders are like doctors; some have a bedside manner and some don’t. Speak to at least three lenders to find the one that fits you – you do not want to feel alone when you are dealing with this level of investment. Without hesitation, ask each of them if they have a record of CLOSING ON TIME. It is amazing how many lenders don’t pick up a file until a few days prior to set closing. This lapse in their time management causes a ripple effect and all parties (except the lender) will be extremely frustrated.
Once you have found your preferred lender, you will work with them to get a pre-approval letter. This simply states what loan amount you MIGHT be able to obtain. I use the word “might” because this letter is based on very basic information that you share with your lender; income, debt, etc. Once you get into a contract for purchase, this lender will get a LOT more information from you and will be able to give you an absolute on the loan approval.