Get Pre-Approved Prior to Searching for Horse Property? But Why?
The first step to take before starting the search for horse property, or even contacting a real estate professional, is to contact a local lender. One thing to keep in mind when choosing a lender to buy a horse farm: check to see if the lender will finance a property with acreage. Not all lenders do finance farmettes or farms.
Basically, a pre-approval is where the lender will ask for your financial information, such as your debts, income, etc. and will ask for proof of income as well as your federal taxes from the past 2-3 years, to determine the maximum price you can afford.
The reason for contacting the lender first is to get pre-approved for a loan. Many may ask why if they haven't found a property yet.
There are several reasons why.
You might think that you are able to afford $x,xxx per month. That may be true, but there are other expenses that need to be factored in. Remember, when buying a horse farm, there are expenses that are assocaited with horses, their maintenance, plus the maintenance of the property. Funds should be in savings in case of an emergency. You might think you have it covered, but you never know when an emergency may arise.
Getting pre-approved will give you an idea as to what price range you should be searching in. No sense in looking at a property that turns out to be unaffordable for you, especially after falling in love with it. It will be a great disappointment.
When the property of your dreams has been found, that is the time to consider putting in an offer on it. When an offer is put in on real estate, in addition to an earnest deposit, a pre-approval letter from a reputable local lender should accompany it. The pre-approval shows to the Seller that yes, you are able to purchase the property, that you are not wasting anyone's time.
If the pre-approval is done after the fact, there may be a chance that you may lose out on the property, especially in the case where there are multiple offers and where there is lots of activity on the property.
So, if you are considering on starting your search for a farm or horse property, start by contacting a local, reputable lender to be pre-approved.
Brigita McKelvie is a REALTOR® (Pennsylvania License #RS297130) with Cindy Stys Equestrian & Country Properties, specializing in rural and horse properties and farms in Eastern Pennsylvania. She has an e-Pro® (Certified Internet Expert) certification and a GRI (Graduate, REALTOR® Institute) designation.
Brigita McKelvie, REALTOR
Pennsylvania License #RS297130
Rural and Horse Properties and Farms
Cindy Stys Equestrian & Country Properties, Ltd.
The Premier Equine and Country Real Estate firm serving Eastern Pennsylvania from back yard operations to world class equestrian facilities.
Use a REALTOR with "horse sense" that doesn't horse around when it comes to horse properties.