February 2021

Mortgage basics for your first-time buyers

First-time homebuyers may be motivated, but are they really ready to buy? Our research shows that while a majority (80%) admit they'll need help to understand what they can afford, over half don't plan to apply for prequalification, missing the opportunity to learn how much they can qualify for in a mortgage.Footnote1

There's nothing more disappointing than a sale that falls through because your clients weren't financially ready. Here are some reminders of what your clients need to know to bring their home search to a successful close.

Upfront preparation is key.

Even with repeat buyers, it's important to confirm that your prospective clients have done their homework. That includes checking their credit, deciding on a budget, and making sure they have funds for a down payment and closing costs.

Tip: Clients can visit the Down Payment Center on my website to search for programs that can help with their upfront costs.

Shopping for a loan makes sense.

With typical mortgage terms of 30 years, even a small difference in rates can have a large effect on a client's monthly mortgage payment. Since most buyers can be prequalifiedFootnote2 in minutes, encourage clients to prequalify with several lenders to make sure they get the best possible deal.

Tip: With Bank of America, clients can be prequalified online, over the phone or in person.

There's more than one kind of mortgage.

Inexperienced homebuyers may not know that there are different types of mortgages for different needs. For instance, a mortgage with a low down payment can sometimes make the difference between buying now or waiting to save more for upfront costs.

Tip: A Bank of America lending specialist can help your clients review their situation and find a mortgage that's right for them.

Understanding the process pays.

Do your clients know what documentation they'll need to apply for a mortgage? Are they aware that final approval may depend on both an appraisal and an inspection? Review the process with them so they don't drop the ball at a key point.

Tip: Bank of America's Home Loan Navigator® keeps clients up to date with every step of the process.

Reviewing these basics with your clients — or encouraging them to consult their lending specialist — is an easy way to help avoid bumps on the road to your client's new home. By helping to smooth the way, you can count on great reviews from the happy new homeowners.

A note from your lending specialist:

Feel free to contact me anytime if you or your clients have home loan questions. I'm here to help!

1 Source: Bank of America 2020 Homebuyer Insights.

2 Prequalification is neither preapproval nor a commitment to lend; borrower must submit additional information for review and approval.

MAP3372677 | 12/2020

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