Right now may be the perfect time for prospective home buyers to make that big dream investment. Many will still face the hurdle of qualifying for a home loan. In some situations, real estate agents may need to get creative to make sure that their clients can get the home they want when they want it. Consider these following 5 tips to help home buyers get approved for loans.
1. Explore alternative loans
Alternative loan packages such as FHA loans, Fannie Mae foreclosure loans and military loans may all be easier for a home buyer to acquire. Conventional loans are often very difficult to get, even for buyers who have relatively good credit ratings. Conventional loans also always require a full down payment of 20%. Alternative loan packages can help buyers in two ways. They usually require a much lower down payment than conventional loans and they also usually allow a higher debt-to-income ratio than conventional loans.
2. Alternative lending institutions
Real estate agents with clients who cannot get approved at their local banks can suggest other lending institutions. There are many companies that operate on a national level and specialize in mortgage packages exclusively. It is often easier to get a mortgage through these companies than through a local bank or federal credit union. A real estate agent who wants to provide alternative ideas to their clients should research the largest current loan providers so that they can advise their clients.
3. Credit repair
If a client is having issues getting a loan because of credit issues, a real estate agent can suggest a credit repair company. It is a good idea to research reputable credit repair companies before making suggestions, however, because some repair companies either don’t do a good job or charge fees far in excess of what is needed. Credit repair can help clients by advising them on the best ways to repair their credit and any mistakes that might be on their credit report.
4. Suggest a cosigner
Often, the only way to reliably get a person approved for a loan is to suggest that they get a cosigner. Many buyers are hesitant to get a cosigner, but if the situation is fully explained they may understand why it is a necessity. Some people hesitate before getting a cosigner because they don’t know how it affects the ownership of the property. You can explain to the buyer that a cosigner can be, but doesn’t have to be named on the property deed if the buyer doesn’t want them to be.
5. Get involved
Speaking with the client’s mortgage company directly may be the easiest way to find out more about the client’s situation and how to help them. A real estate agent with a client who is having difficulties may want to ask the client for permission to talk directly to the mortgage company. With this permission, the agent will be able to better understand the client’s finances and be better able to help them.
The job of a real estate agent is a complex one, and agents often have to go above and beyond the call of duty to secure their buyers the homes they want. A real estate agent should not be afraid to exhaust all options when acting as an advocate for their client. With determination and patience there are many things real estate agents can try to make their clients more suitable for a loan.
Being an advocate for your buyer doesn’t stop with the loan. Consider suggesting an HSA Home Warranty for more protection.