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If you’re going to be buying a home in the near future there are certain questions to expect to be asked. It doesn’t matter if it will be the first home you’re purchasing or the twentieth home.
It’s important that you understand that the questions you’ll be asked are not asked for the purpose of snooping. The questions to expect are asked to help better serve you and make sure the home buying process is an enjoyable and successful one.
Below are the most common questions to expect to be asked by both a lender and a real estate agent when buying a home. The mortgage consultant and a real estate agent are two of the most important professionals you will need during the home buying process. Having an understanding why these professionals ask the questions that they do can truly make the home buying process much easier.
One of the most important pieces to the home buying puzzle relates to the financing. It’s important when buying a home you understand what the top mortgage FAQs are but also what questions to expect to be asked by a lender. Below are some of the most common questions to expect to be asked by a lender when buying a home.
One of the first questions to expect to be asked by a mortgage consultant relates to where you work and for how long you’ve worked at your current employer. One of the primary reasons this question is asked is to help the mortgage consultant understand your employment history.
Depending on the type of financing a buyer is attempting to obtain, the length and type of employment factors into whether a buyer will be accepted for the mortgage or not. One of the most common reasons a mortgage is denied after approval is due to changes in employment.
If a buyer has frequent job changes over the past couple years, it will be more challenging to obtain financing for a home purchase. It can also be challenging if a buyer changes their field of work.
For example, recently while attempting to help a buyer purchase a home in Rochester, NY, the buyer changed their career field from a salaried employee for a company to self-employed in the past year. This ultimately led to them not being able to purchase a home at the current moment due to their short work history in their new field of work.
Another question to expect to be asked when buying a home will relate to your income. A mortgage consultant does not ask how much money you make because they are curious. Knowing how much a buyer makes is critical in order to successfully get them approved for a mortgage.
The amount of money a buyer makes plays a huge role in how much of a home a buyer can purchase. The more money a buyer makes generally means the more expensive of a home they can purchase.
Not only is the amount of money a buyer makes important when buying a home but how the income is paid is very important as well. A question to expect to be asked when buying a home is how your income is paid. Are you an hourly employee? Do you have a yearly salary? Are you straight commission?
Lots of buyers don’t understand why they are asked how their income is paid. The primary reason it’s important for the lender to understand how income is paid is so they know whether their income will be a stable and guaranteed amount after the loan is funded.
If a buyer is self-employed the lender is going to require more documentation, primarily their tax returns for the previous 2-3 years, prior to issuing a pre-approval. The reason a lender will ask for additional documentation from a self-employed applicant is to ensure they’ve earned a stable income over the past several years. Generally a lender will average the past 2 years of net income, which is their income after any deductions, from a buyers tax returns to use for qualifying purposes.
Lenders will request similar documentation from buyers who have commission based incomes.
The debt that a buyer has can sometimes make or break whether they can get approved for a mortgage or not. Another question to expect to be asked by a mortgage consultant when buying a home is about your current debts.
A buyer who has a solid employment history and good income but has lots of debts can have trouble obtaining a mortgage. A term that you will hear being used in the mortgage industry is debt to income ratio. Depending on the type of financing a buyer is obtaining, there are different maximum ratio levels.
Debt to income ratios play a big part in whether a buyer can get a mortgage or not. Debt to income ratios have become a common reason why millennial buyers are not able to get a mortgage due to their student loan debts.
Again, don’t be offended when a mortgage consultant asks you about the debts that you have, they are just doing their job and making sure your home buying experience is successful.
Some buyers are uncomfortable talking about the money they have saved in their bank accounts. It’s important to realize that the amount of money you have saved is a question to expect to be asked.
While there are ways to buy a home with very little money, it is still important for a mortgage consultant to know exactly how much money a buyer has to work with. Some mortgage products require a buyer to contribute a certain amount of money towards the purchase of a home.
For example, an FHA mortgage requires a down payment minimum of 3.5%. While there are ways to successfully negotiate a seller concession, it cannot be relied on that it is a guarantee a seller will be willing to help with a buyers closing expenses.
When you begin to shop for homes you will start to come into contact with real estate agents. It’s important when buying a home that you know what interview questions to ask potential buyers agents, since it is critical to hire a top agent.
It’s equally as important to know what questions to expect to be asked by a real estate agent when buying a home so that you’re not caught off guard or offended by the questions. Below are some of the most common questions to expect to be asked by a real estate agent throughout the home buying process.
The first question to expect when coming in contact with a real estate agent should be whether or not you’re working with a real estate agent. A top real estate agent will generally have a strong reputation with other real estate agents. A real estate agent who asks a buyer whether they have an agent or not is just being respectful of their peers. An agent who attempts to steal a buyer who is working with another real estate agent will quickly tarnish their reputation.
Another reason why real estate agents will ask a buyer whether they’re working with a real estate agent or not is because it is not a good idea to work with more than one agent. In fact, buyers who think working with more than one agent is OK is one thing buyers do that real estate agents hate.
When buying a home it’s important you’re comfortable, believe, and have trust in the real estate agent you’re working with because strong representation is paramount to a successful home buying experience. Hiring the wrong real estate agent can be the kiss of death when buying a home. There are certain tell-tale signs that indicate that you’ve hired the wrong real estate agent and if you see any of them you should consider exploring other options, if able.
The real estate profession is a very competitive one. There are endless ways in which a real estate agent can market themselves. A question to expect when speaking with a real estate agent relates to how you came about contacting them. The reason a real estate agent will ask how a buyer heard about them is to help them analyze what marketing and advertising efforts are working for them.
Were you referred to them from a family member? One of their past clients? Did you find them while searching online? These are just a few of the most common ways buyers will hear about real estate agents.
There are many reasons why real estate agents ask buyers if they’ve been pre-approved. It is a question to expect when buying a home, in fact, it will be one of the first questions you will be asked when attempting to view homes.
The number one reason a real estate agent will ask a buyer if they’ve been pre-approved before showing them houses is for their own safety. Realtor safety has been a very popular topic in the real estate community over the past year with the growing number of tragic events that have been occurring in the industry.
Another question to expect from a real estate agent is whether you’ve purchased a home in the past or not. If a buyer has never purchased a home and is buying their first home, it’s possible they will need some additional explanations on certain items.
There are certain tips for first time home buyers that may not apply to a buyer who has purchased five homes in the past. For example, a first time home buyer will often not consider the additional expenses of owning a home such as utilities, refuse, and general maintenance.
Knowing whether a buyer currently owns a home or not is very important to a real estate agent. Buying and selling a home at the same time can be very tricky and it’s important for an agent to know which steps to take first.
If a buyer happens to own a home, it is very important for a real estate agent to know whether the buyer has the ability or desire to purchase a home without selling their current home. This is a question to expect when buying a home because there are so many intricacies to buying and selling a home at the same time and it’s critical the real estate agent knows upfront so they can advise accordingly.
Timing is very important in real estate. A common question to expect to be asked by a real estate agent when buying a home is regarding the time frame in which you want to purchase a home.
It’s common for some buyers to not understand the how long (or short) it takes to purchase a home. Generally speaking, a real estate transaction that involves a buyer obtaining a mortgage will take 60 days from contract date to closing.
A buyer who has a lease for another 6 months and is not willing or able to break their lease is prematurely looking at homes. If you don’t plan on purchasing a home for 6 months, what is available for sale today will not be available in 6 months, especially if you’re buying a home in a sellers market.
One of the biggest complaints about real estate agents from consumers is the lack of communication from some agents. An agent who asks by which method you prefer to communicate is likely to be a strong agent.
With the technology that is available, buying a home and the methods of communication are much different than 10 years ago. Buyers and real estate agents are now communicating, or should be, via text messages, e-mail, Skype, phone conversations, and many other methods.
One of the most important factors to a buyer should be the location or neighborhood they want to live in. A question to expect from a real estate agent is where you would like to live.
Depending on where a buyer is purchasing a home there maybe only a couple neighborhoods or several. It’s recommended when buying a home that you know how to select a neighborhood and some tips that can help with the decision.
During an initial consultation with a real estate agent when buying a home a buyer should expect to be asked about their needs and their wants. The reason this is such a common question to expect to be asked is because this can help a real estate agent narrow down the number of potential properties for a buyer.
It can be very overwhelming for a buyer to receive a list of 200 potential property matches. An agent who asks about your needs and your wants is trying to eliminate some of the properties that will absolutely not work for you.
What are some of the common NEEDS that some home buyers have?
What are some of the common WANTS that some home buyers have?
One of the best ways to determine your own needs and wants is to ask yourself whether you can live without something or not. For example, if you have two children and don’t want the children to share a room then you would need at least 3 bedrooms.
Almost every home buyer will have at least one or two “deal breakers.” A deal breaker is something that a buyer could not overlook, even if the house was perfect in every other way. A question to expect to be asked when buying a home is whether there are things that are deal breakers.
Some of the most common deal breakers with buyers include a home being located on a primary road, a home that has no basement, or a home that has only 2 bedrooms. These are just a few of the most popular deal breakers and certainly vary from buyer to buyer.
The most successful real estate agents will make sure they set expectations from the beginning when working with a buyer. A question that you should expect to be asked is what you expect from your real estate agent when buying a home.
If a real estate agent asks you this question this is your opportunity to make it clear what you expect from them. Are there certain times you prefer looking at homes? Do you prefer certain methods of communication? If you feel that the things you are expecting from your real estate agent cannot be fulfilled, you may want to consider interviewing other real estate agents.
If you’re going to be starting the home buying process soon, it’s important to understand the questions to expect to be asked. Buyers who understand that these questions are asked with the sole purpose of making the home buying process more enjoyable and successful put themselves in a much better position than those who do not.
If you’re thinking about buying a home in Rochester NY, these questions are just a handful of the common ones to expect to be asked. It’s important to not be upset when you’re asked these questions but to understand answering them truthfully will make your home buying experience more enjoyable and more importantly, successful! If you haven’t hired a top Rochester real estate agent yet, contact me and I’d be happy to talk with you about your real estate needs.
About the authors: The above article “Questions To Expect To Be Asked When Buying A Home” was provided by the Keith Hiscock Sold Team (Keith & Kyle Hiscock). With over 30 years combined experience, if you’re thinking of selling or buying, we’d love to share our knowledge and expertise.
We service the following Greater Rochester NY areas: Irondequoit, Webster, Penfield, Pittsford, Fairport, Brighton, Greece, Gates, Hilton, Brockport, Mendon, Henrietta, Perinton, Churchville, Scottsville, East Rochester, Rush, Honeoye Falls, Chili, and Victor NY.
Visit our website at www.HiscockHomes.com.
© 2015 – 2016, Kyle Hiscock. All rights reserved.
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