Should You Talk to a Mortgage Lender or Real Estate Agent First?

Before Purchasing a Home, Should You Talk to a Lender or Real Estate Agent First?

Ready to purchase a new home? Congrats – how exciting! Before you start house hunting, you may be wondering: should I contact a lender or real estate agent first? 

Both play important roles in the home buying process. Lenders secure financing so you can afford the home. Agents help you find and purchase the perfect property. So, who should you turn to first? 

Here we’ll compare the benefits of speaking to a lender vs. an agent first. We’ll also provide tips to help you decide the best plan of action for your situation.  

Pros of Speaking to a Lender First

Starting with a lender has its advantages, like:

– Knowing your exact loan amount helps you to set a realistic budget.

– The ability to make stronger offers since sellers know you can secure financing.

– Locking in low interest rates promptly if they’re trending up. This prevents a higher rate later.

Cons of Speaking to a Lender First

Potential drawbacks include:

– Rates and loan programs can change if too much time passes after getting pre-approved.

– You may not have defined your home must-haves yet, making it harder for a lender to advise you.

– Lenders mainly cover financing, not the home search and purchasing process.

Pros of Speaking to an Agent First

Meeting with an agent first has advantages such as:

– Gaining insights on the local real estate market, inventory and pricing.

– Defining your needs and preferences for a home.

– Getting a head start on the search with listings matching your criteria.

– Viewing homes with an expert by your side.

– Receiving insights on neighborhoods, negotiations and competing offers.

Cons of Speaking to an Agent First

Some potential disadvantages include:

– Not knowing your budget without financing in place first.

– Potentially falling for a home before getting pre-approved, which leads to disappointment.

– Making an offer without a pre-approval carries less weight.

– An agent can’t explain mortgage options like a lender can.

Tips for Deciding

So, what’s the best plan of action for your situation? Here are a few tips:

If your timeline for purchasing is tight, or rates are trending up, go to the lender first to expedite financing and lock in lower rates. In highly competitive markets, lead with the lender as well – pre-approval makes your offers stronger.

If you’ve already defined your home must-haves, starting with an agent can get the search rolling quickly. However, if you need extra care throughout the buying journey, an agent may be the better choice.

Remember – you aren’t locked in your choice. You can always meet with the other shortly after! The key is starting somewhere to gain clarity.

Reach out any time if you would like more details about these choices and more!

Bridget (604-805-6820)

Article courtesyof Stilhavn Real Estate Services