Why being choosy as home buyer could be problematic

You’ve decided to buy a home, you’ve gotten preapproved with a lender, your file has even been pre-underwritten. Here are some things you might want to give some consideration to- what you want versus what the market might support…

Here’s to considerations to think about..
Consideration one- Let’s say you’re pre-approved to $700,000, the house you want is a standard three-bedroom two bath however, you also need to have a pool, and its has to be on five acres of land. In the market in which are looking for that type of house that is in relatively good condition needs extraordinarily little or no work is $900,000+.  Your expectations of what you want are so high in relation to the price you can afford the situation becomes completely out of reach. When you start really looking at the goal and putting yourself in a situation where your expectations are such that they are out of alignment with what market expectation supports is a tall tale sign you’re just not ready to purchase a home yet. This is ok because real estate can take time and often times good things come to those who are patient with the process as long as they can align what they want to what the market will support.

Consideration two – similar to the first consideration let’s say the house you want is attainable at the price you are qualified at-using this $700,000 maximum purchase price. The house you want is $700,000. However..

This requirements exists:

  • certain neighborhood only
  • a certain geographical ZIP Code
  • must be single-story home
  • must have a big back yard

The challenge that does not exist here is flexibility. Here’s why- let’s say this house does exist, but it only comes on the market maybe one or two times a year. That means for 12 months of the year you have only two opportunities for example to get this unicorn house. More than than likely if you’re that specific about a certain house in a certain geographical area and a certain neighborhood and a single-story with a big back yard, there’s probably an 80% chance your competition has the exact same goal which means that your $700,000 price point that you can afford to get the house that you want gets pricier because other buyers bid the the home up. This means you could wait for years before you buy the home, because the opportunities only come up, maybe one or two times per year and then when they do come up the house you want is flooded with other offers which means you have some considerations to make either adjust your criteria, get more of a down payment, pay off debt, get a cosigner to increase your purchasing power. If can increase the purchasing power for the right house, you need to be willing to go all in to do whatever it takes to get that house or risk not getting it and not moving the needle and staying in the same situation you presently in. Its either getting more buying buyer and throw the farm at it or adjust your specific home characteristic criteria.

When you’re buying a home, it’s a series of checks and balances making considerations and/or concessions for the right house in the right by in the right neighborhood for the home that you want knowing you could always fix up the home in the future. In other words, real estate is a location, location game and every real estate expert will agree. The driver of buying any one home ought to begin with the location, then the house. If you focus on the house first that may lead to difficult criteria further eating into to your possibility of buying a home becoming a dream versus reality.

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RELATED MORTGAGE ADVICE FROM SCOTT SHELDON

When buying a home, it’s natural to want the lowest mortgage rate possible. But sometimes, chasing a slightly better rate from another lender—especially after your offer has already been accepted—can backfire in a big way. Let’s walk through a real-world scenario. You’ve got an offer accepted on a house. You’re working with a lender who has you approved, documents in underwriting, and a 21-day close of escrow in place. Everything is moving forward. Then you hear from another lender offering a rate that’s 0.25% lower, with slightly better closing costs. It’s tempting. But before you make a jump, here’s what you need to consider. Switching Lenders Comes with Time Costs When you pivot to a new lender mid-contract, they’ll need to: Re-underwrite your entire loan, Order a new appraisal, Disclose and sign new loan documents, Submit the file for final loan approval, Schedule and fund closing—all over again. This doesn’t happen overnight. Even in ideal circumstances, the new lender is likely going to need at least 25–30 days to close. If you’re in a fast-moving or competitive market, this is a real problem. Most sellers won’t grant a contract extension just because you’re switching lenders. So, what happens next? A Contract Extension Can Jeopardize Your Deal Asking for a contract extension means the seller must agree to delay closing. But that delay introduces risk—especially if the seller has backup offers or simply wants certainty. They may not grant the extension. Or worse, they could cancel the deal outright and take another buyer’s offer. Even if the seller agrees to extend, your earnest money and negotiation power could take a hit. And for what? A slightly lower rate that might save you $50 to $75 a month? Mortgage Rates Aren’t as Far Apart as You Think Here’s the truth: all mortgage lenders get their money from the same place—the bond market. The pricing differences between lenders usually range from 0.125% to 0.25% in rate on any given day. If one lender seems to be offering dramatically better pricing, the first thing you should ask is: How? Head over to FreddieMac.com and check the average 30-year fixed rate posted weekly. This is one of the most reliable benchmarks for where rates truly stand in the market. If a lender is quoting you a rate that’s well below that average, ask for the details: Are they charging extra points? Is this a teaser rate with a prepayment penalty? Is it based on a different loan product or risky structure? Often, what sounds “too good to be true”… is. Consider the Bigger Picture Think long-term. If you’re financing $600,000, a 0.25% lower rate may reduce your payment by roughly $75/month. But what if you lose the house and have to start over? That monthly savings doesn’t mean much if you’re outbid on your dream home or lose your deposit. Also, remember: you’re not going to keep this rate forever. Today’s homebuyers typically refinance when rates drop by about 0.75% or more. So if rates fall within the next year or two, you’ll likely be refinancing anyway. Instead of paying extra points now or risking the entire deal for a minor monthly savings, it may be better to accept a slightly higher rate—knowing you’ll refinance when the time is right. The Real Risk Isn’t the Rate—It’s the Delay When shopping for a home loan, don’t just ask, “What’s your rate?” Ask: Can you close on time? Is this rate sustainable or based on hidden costs? Will switching lenders delay or jeopardize my contract? A home purchase contract is a binding agreement between you and the seller to perform within a set timeframe. If you can’t meet those dates because you're chasing a slightly better rate elsewhere, you may want to reconsider if now is the right time to buy. Final Thoughts Yes, interest rates matter. But execution matters more. Before making a switch mid-transaction, talk to your lender. Have an honest conversation about pricing, timelines, and strategy. You might find that staying the course, securing the house, and planning to refinance later offers a better path to financial security. Want to Know Your Options? Let’s compare rates and strategies the smart way—without risking your dream home. 👉 Click here to get a custom rate quote today.

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