One of the most important aspects of purchasing a home is making sure that you have financing that is right for you.

Is a low monthly payment important? Or, maybe, it’s more important to pay off the mortgage more quickly with a 15 year mortgage or larger down payment. Maybe you need to get financing that only requires a minimum down payment or none at all.  Whatever the situation is, it’s important to get all that worked out in advance of making an offer on a house.  After all, the financial ability of a home buyer to complete the purchase is a huge factor in any home seller’s mind when looking at the offer.

Your Realtor is a great resource for something like this.  He or she knows the good loan officers and good mortgage companies that can look at your financial situation, tell you what they can do for you and, most importantly, deliver on their promise to provide you with the money to complete the purchase of your new home.

Changing Up on Your Financing

In the Maryland Association of Realtors contract form, there is a way to change your financing even after the offer has been accepted and inspections are either in process or have been completed.

However, you need to provide proof to the home seller that this financing is committed and that it isn’t going to cost the home seller a dime.  If you can’t do that, you should stick with your original plan.

The Contract is a Legally Binding Document

The contract you signed when you placed an offer on the house and the one that the seller agreed to after all the negotiations and back and forth is a legally binding document. The contract in Maryland is ten pages long and covers just about anything and everything in any number of different home purchasing scenarios.  That doesn’t count the addenda which pick up where the contract left off.

It’s that long and that detailed for a reason.  It’s a contract.  It’s a legal promise by both the buyer and the seller to do certain things to make sure that the property conveys from the home seller to the home buyer in a legal way.

Changing your mind about financing half way through the process because you might have heard there is a better deal to be had is not a good enough reason to want to change the terms of the contract.  That’s why the Maryland contract requires that any new or “alternate” financing be fully committed in writing with all the details of the new or “alternate” financing.

Financing Takes Time

The real deal here is that financing takes time.  It’s not like going up to the check out counter and deciding to use your debit card instead of cash.  Mortgage companies require tons of documentation and an appraisal along with all the underwriting requirements.  It’s not easy and it takes a ton of time.  The days when a loan could get done in two weeks (or even a week!) are long gone.

Changing your financing is pretty much like asking the home seller to start over from the beginning.  Sure. The inspections have been completed but all the financing stuff has to start from square one:

• verification of funds for a down payment
• verification of employment
• verification of tax returns (yes, they really make sure the tax returns you submit are real)
• verification of bank statements
• appraisal
• and on and on

It’s no picnic. The best advice is to do all the research of the different loan programs up front and make a decision to go with one and stick with it.  In this market, there is plenty of time to do the research you need to do.  You can even trust your Realtor to help you make a good decision. Changing horses in mid-stream is not a good option. You may find out that you’ve lost the house you really wanted.

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