If you're thinking of purchasing a home in Bend, the first step is to get pre-approved for a mortgage (unless you're paying cash of course). The mortgage pre-approval process has become more of a chore over the past few years than it was prior to the real estate bubble bursting. But it's still a relatively easy process.
First Step of Mortgage Pre-Approval Process
Contact a local Bend mortgage broker or bank, preferably a referral from a friend, family, or your real estate broker. You should interview the mortgage professional and ask any questions that you have. Make sure to let them know how much you feel comfortable spending on a monthly mortgage. Ask them about different home loan options, down-payment options, interest rates offered, and closing costs. If you don't have a lot of money for a down-payment and want to keep as much in your pocket as possible, make sure to ask your Realtor and loan officer about asking the seller to pay some or all of your closing costs for you.
Have the mortgage broker run your credit and see where you stand. You may need to take care of any credit issues prior to getting a home loan. Collections and judgements usually need to be dealt with right away. Certain credit "dings" will prevent you from getting a home loan for a period of time, or until your credit is worthy.
You may want to "shop around" for better rates and/or lower closing costs. But beware of Internet lenders and advertised interest rates. Most advertised interest rates are for "prime" borrowers with nearly perfect credit. Your credit and debt to income ratios will determine what rate you qualify for. But it's always a good idea to talk to a couple of different options before you get the process started. It's also a good idea to play with a mortgage calculator on your own (but keep in mind that if you're putting less than 20% down, you'll have a private mortgage insurance monthly premium added to your payment).
After you've made a choice of which lender you want to go with, you'll need to gather all of your financial documentation. This will include taxes, bank statements, pay stubs, and any other important financial documentation requested by your lender. They will give you a list of items that they will need to get the pre-approval started. Be aware if you have any large, abnormal deposits in your bank account, the lender will probably need a written explanation.
Submit everything to the mortgage broker for review. They will look over all of your documentation and determine your borrowing capability. Be prepared to answer any questions and/or submit any additional documentation required. The loan officer should be able to get you a pre-qualification letter within days, but a full pre-approval may take more time.
Once you've submitted everything for approval, please don't go out and finance a new car, diamond ring, or any thing else that will hurt your debt to income ratio or credit. It sounds basic, but many times buyers will acquire new debt during the loan process and it will create potentially deal killing problems.
If you'd like help getting pre-approved for a home loan in the Bend Oregon area, please contact me.