Common Loan Questions



Do you have common loan questions?

I recently sat down with Stacey Gross of Caliber Home Loans and asked her some common loan questions that buyers may have.

Click on the image to watch the interview.

What is advice do you have for first time homebuyers?

Well some of the best things that a first-time home buyer can do is to help them prepare is to do a complete loan application so that we can really determine what’s going to fit their budget and what they feel comfortable for a monthly payment. We never want to put anyone in a situation where they may be paying more outside their comfort zone. So let’s really tailor what their needs are for the best loan option.

Can you help with the myth of people who are obtaining loans thinking they have to put 20% down?

Yes, that is a common myth that a lot of people think. Gosh, I need to have a big down payment to buy a home and that’s not really true. Depending on whether you’re a first-time home buyer or buying again, there are many programs out there for first-time home buyers. So in regards to a first-time home buyer, we might be able to get them in with as little as 3% down, or if there is a need for a down payment assistance program, the state of Arizona offers several down payment assistance programs. So it’s a really good time to at least see what are your options.

In a hot market like we’re experiencing right now, here in Phoenix, how can a buyer better positioned themselves?

That’s a great question because it is so competitive right now. Many times the better prepared buyer is the one who is going to win out when they are putting in their offer. So it’s critical that we go through and we do a full pre-approval and not just a pre-qualification. Let’s verify assets, verify income, and go through and pull credit. Once we’ve done those three critical pieces to the application process, we can then determine what’s going to be the best program and complete the pre-approval for them so that they really look great to that seller. So when there are multiple offers on a property, their paperwork looks complete, and really puts them in the best light with that listing agent and with that seller to hopefully help them win out the contract.

At the time of this recording, I hear we’re at historically low interest rates. Is now a great time to buy?

Yeah, it’s a great time to buy. Because at this point where we are now seeing such low interest rates, we have the ability to buy up right so where a lot of times when the rates interest rates are higher, it restricts how much a buyer can qualify for. This is where it gets opens up the door for buyers to really explore what more could I purchase now, but increases your purchasing power. So it’s a great time to get into the market. If you’re even thinking about it or from an investment standpoint, a lot of times investors like to look at this time as an opportunity to jump into the market.

Why does Caliber Home Loans standout while working as a team with a buyer’s agent?

One of the really critical pieces in the real estate transaction is communication. And as a team, and I think that’s why you and I complement each other so well is that our communication is regular and consistent for that buyer. So throughout the entire transaction, Caliber sets up key milestones where you’re going to communicate to the buyer and get the information in regards to all the steps that are happening on a weekly basis. You’re well informed along with our dialogue back and forth with the buyer. So that makes sure that everybody, the listing agent, the seller, all parties involved are up to date in regards to what’s happening. So that we can really make sure that the process the buying process goes smoothly and is enjoyable. We never want anybody to feel like they’re not being communicated with or getting all the information that they need for a successful transaction.

What do you do with someone who’s got the cash, but doesn’t have the typical credit history?

I mean, that’s a great question. When you have a situation where somebody doesn’t have traditional credit lines, meaning an installment debt like a car loan, or they don’t have credit cards, they’re predominantly do most of their business with cash. In that situation, we have what’s called non- traditional credit lines, so we can pull them from your cell phone. We can reach out to utility companies and make a credit report for them. So Caliber does help them with that. iIt doesn’t restrict those buyers when it comes to non-traditional credit. So it really helps the buyers that don’t want to live with a lot of credit and they want to pay as they go. So it should not ever restrict anybody from buying home. So it’s a great option for somebody that maybe is new or younger or just doesn’t use those traditional credit lines, we’ve got an option for them.

Otherwise, I would have thought they would have been penalized. And in many situations, they are. Very few mortgage companies will consider that type of a buyer scenario because of the lack of other traditional credit line.

How do people go about getting started?

It’s actually a really easy process. We now have a couple of options for borrowers. One is our online process takes about 15-20 minutes for the borrower to complete the online application. The application will walk them through and ask them all of the questions so that when that application is completed, they’re gonna even know what their credit score is like. It’s really a streamlined process. The application comes over and I have the opportunity to review everything and prepare what their best options. Now you get a chance to really dive into the numbers and get a feel for what’s going to be the best option.

So does that then lead into the pre-approval process?

So it does. It takes them right into now I know exactly what I’m qualified for. I’m comfortable with that mortgage payment and I know exactly what I need to bring in for a down payment. Now you can go out and look for a home and that’s going to be the fun part.

I hope these common loan questions help you. If you have any additional questions, then please contact me or Stacey Gross.