A drop in mortgage rates has many homeowners dreaming of acquiring a larger residence. But first they must sell their current property.

“Lower mortgage rates unlock peoples’ hopes and aspirations. Once again, they’re projecting ahead for the future,” says Mark Nash, a longtime real estate agent.

But even for those with a highly marketable property, there is no such thing as an instantaneous sale.

“I won’t say it’s never happened. But the idea of selling in a flash without any presale repairs or upgrades is certainly very rare,” says Nash, the author of “1001 Tips for Buying and Selling a Home.”

This summer was a relatively slow time for some contractors -- given uncertainty about the economy. But the drop in rates has recently unleashed a wave of added demand for both remodeling and homebuying.

“For most contractors, the twists and turns of the macro economy make a meaningful difference in their volume of work. Lower interest rates help everyone -- buyers, sellers and remodelers alike,” Nash says.

Are you drawing up plans for a home sale? Then these few pointers on engaging contractors could prove helpful:

-- Don’t assume that the lowest bid is the best for you.

Marty Schirber, who led his Minnesota-based remodeling company for more than four decades, says the cheapest bid for a home improvement job doesn’t guarantee the best deal for the homeowner.

“An unusually low bid may be cause for alarm,” he says, noting that it could indicate that the contractor doesn’t fully grasp the project’s scope. It could also reflect inexperience or an underestimation of the cost of labor and materials,” he says.

In the worst-case scenario, the low bid could mean the contractor “is planning to cut corners by using inferior materials, low-paid, inexperienced workers, or not following local building codes.”

On the other hand, he occasionally encounters people who’ve had horrific experiences working with high-priced contractors.

“Price has very little to do with the success of the job,” Schirber says.

He says the secret to comparison shopping on price is to present all the bidders with specifications for your jobs and then to ask each to break down the charges on a line-by-line basis.

For example, suppose you want your living room and dining area painted prior to your home sale. And you want a quality job that includes a primer coat, along with two additional coats. You also want a particular brand of paint.

By specifying your requirements and obtaining a breakdown of charges, you should get comparable estimates from multiple contractors, Schirber says.

Those seeking online pointers on contractor selection may wish to visit the website of a company called Ask the Builder (askthebuilder.com).

-- Make sure your contractor covers all the details in his bid.

Once you’ve chosen your contractor, it’s time to get all aspects of your project down in writing.

“The contract should convey to everyone involved what the finished product will look like,” Schirber says.

Among other elements, this document should spell out a summary of the work as well as provisions for permits, estimated starting and completion dates and a schedule of payments. It should also include procedures for handling change orders.

“Oral agreements are vague or confusing. They’re an invitation for misunderstandings, which can easily ruin your job,” Schirber says.

-- Create a list of contractors for pre-sale work.

Many people find it a troubling task to locate contractors. But R. Dodge Woodson, author of “Tips & Traps for Hiring a Contractor,” advises against relying on online advertising for this purpose.

A more reliable approach is to seek out recommendations from acquaintances who’ve had work done on their own homes.

Eric Tyson, co-author of “House Selling for Dummies,” recommends you request contractors’ names through local real estate agents.

Contractors may be more attentive to your project if they know you could complain about their work to the agent, which could limit their chances for repeat business.

“Any agent who picks up complaints about a contractor will stop recommending that person,” Tyson says.

-- Seek names from neighbors you know and respect.

A ready source of contractors’ names can be found right in your own neighborhood.

“Your neighborhood could be a terrific source of contractor gems. In most cases, neighbors will be very candid about who excels or does terrible work,” Nash says.

One novel way of getting referrals from nearby residents is to throw a neighborhood party and ask all who attend to bring along the name of at least one contractor they like.

“Create a flyer with a party invitation attached. Pass out a flyer with the party invitation and attach a questionnaire for referrals. Then vow to send all who attend a compilation of names after the party is over,” Nash says.

-- Always look beyond a single bid.

Woodson, who’s worked much of his career as a licensed plumber and ran a home improvement business, strongly recommends that homeowners obtain five estimates for any major work, particularly for any job worth over $5,000.

Why five? Because experience has taught Woodson that consumers need a range of bids to gain perspective.

Once you have all your estimates lined up, Woodson suggests you eliminate anyone charging more than 20% above the median. Also, toss out anyone charging 20% less.

“A low price isn’t the only factor. I’d be scared to hire someone who’s a lot cheaper than all the others because he’s probably cutting corners. And anyone more than 20% higher is probably charging too much,” he says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)

A nursing supervisor from Buffalo is excited over current reports that mortgage rates are declining. The single mother of twin boys believes she could finally afford a house in a popular neighborhood with well-rated schools.

“School just started here, and my kids entered first grade. They’re doing great. Still, I’m unimpressed with their teachers at the school near our apartment. I want to buy in an area with stronger schools. This could be my chance,” the nurse says.

She has her eye on several three-bedroom properties with wraparound porches in Williamsville, a historic village that’s convenient to her hospital in downtown Buffalo. But as a first-time buyer, she’s less than confident about mortgage finance and looking for guidance. 

Keith Gumbinger, a mortgage analyst with HSH Associates (hsh.com), which tracks lenders across the country, doesn’t know the nurse in this true story. But he advises all buyers needing mortgage approval to meet in person with a local lender before finalizing any deal. 

“You may be highly accomplished in your chosen profession, with degrees galore. But if you’re a first-time buyer, you’re probably a beginner at mortgages. There’s no shame in seeking help,” Gumbinger says.

Buyers have been delighted to see mortgage rates declining lately. But they know this trend could easily reverse itself. This adds to their anxiety.

Given the difficulties facing first-time buyers, Gumbinger says that finding a mortgage lender who offers personalized service can be helpful.

“You’re committing yourself to a huge loan obligation. You can benefit from help researching your options,” Gumbinger says.

Here are a few pointers for buyers: 

-- Initiate your mortgage search early.

Mortgage products are always evolving. Most new home loan designs involve some type of adjustable-rate mortgage.

“It’s conceivable you could benefit from an ARM,” Gumbinger says.

For example, take the case of buyers who expect a brief tenure in the property they’re planning to purchase this fall.

“Maybe you’ve taken a relatively short-term position with a new company -- a job lasting just three to four years. After that, you plan to attend law school in a distant city. In that case, it could make sense to take an ARM that discounts your interest payments at the front end,” Gumbinger says.

Mortgage innovations can vary widely.

“There are many puzzling twists and turns -- especially with adjustable loans. That’s why it’s critical you know what you’re getting into before you commit to any mortgage product, fixed or adjustable,” Gumbinger says.

He says first-time buyers need as much lead time as possible to educate themselves on mortgage basics, to cull through alternative loan options and compare lenders and rates.

--Look for a lender willing to get you started with tutorials.

Gerri Detweiler, a consumer advocate and author of “The Ultimate Credit Handbook,” encourages first-timers to seek out a mortgage lender who will instruct them on the intricacies of home loans.

“A good lender won’t think it unreasonable to spend a couple of hours teaching you the basics and helping you deal with potential flaws on your credit reports,” says Detweiler, who offers free credit pointers on her website: gerridetweiler.com.

Yet how do you find a sympathetic lender willing to usher you through your first attempt at home finance?

Gumbinger says real estate agents are usually a good bet for sound advice on finding a qualified lender. But he says you should look beyond the suggestions of agents.

“For referrals, I recommend you use what I call ‘The Satisfied Customer Index,’ also known as friends and family,” he says.

-- Arrive at the lender’s office fully prepared.

To maximize the use of your time and that of the lender you’ve chosen for your tutorials, there’s no substitute for gathering key documents in advance of your meeting. Ideally, these should include recent pay stubs, your latest W-2, a couple of years’ worth of federal tax returns and various account statements.

“Anything germane to your financial situation can help the lender help you,” according to Gumbinger.

By providing these documents at the start of the process, your lender should be able to quickly calculate your top borrowing limit and assess your eligibility for various lending programs.

-- Look into your credit standing to make sure you get the best possible rate.

Under federal law, you're entitled to free credit reports from each of the three largest credit bureaus: Equifax, Experian and TransUnion. You can easily request these online (annualcreditreport.com). Besides your credit reports, you'll want to pull your credit scores. Most lenders still use variation of FICO scores, pioneered by the Fair Isaac Corp.

In some cases, you'll need to pay a fee to obtain your credit scores. One way to get them is through the Fair Isaac website: (myfico.com). You can also receive credit scores through the three large credit bureaus. FICO scores range from 300 to 850, and the higher the score, the more likely you are to get the best available rate on your mortgage.

With your credit scores in hand, you can readily begin the process of comparison shopping on rates. Gumbinger strongly suggests you extend your rate hunt well beyond the first lender you consulted. And he recommends you include community banks and credit unions in your search.

“It sounds like overkill. But it’s smart to take the time to make enough extra phone calls to collect at least a dozen rate quotes before going forward with a formal mortgage application,” Gumbinger says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)

A young electrical engineer developed an expertise in artificial intelligence while completing his degree at the University of Florida. With that, he landed a well-paying IT job with a small defense contractor in Orlando.

The 24-year-old engineer intends to propose to his fiancee this fall. The engineer is exploring the Orlando housing market. He’s now focused on a one-level stucco rancher with a large, fenced yard. But he’s wary of committing.

“At $419,000, the house feels reasonably priced. Also, it’s in perfect condition. ... But I have a bunch of student loans. Also, how do I know if my new job will last?” he says.

Eric Tyson, a personal finance advisor and author, doesn’t know the engineer in this true story. But he’s not surprised that the man is equivocating about a home purchase at this point in the housing cycle.

“Even, or maybe especially, in buyer’s markets like Orlando, buyers are nervous that home values could slip more. Maybe they don’t personally recall the housing correction of 2008. But some are still scared it could happen again,” Tyson says.

The engineer says he’s likely to go through with the purchase of the stucco house. Yet before he commits, he’s trying to research the Orlando market and major employment trends there in hopes of gaining reassurance that his housing plan is solid.

“Well-informed buyers have the best chance of doing well on a property purchase and not regretting their choice down the road. They’re also generally the best negotiators,” says Tyson, author of “Let’s Get Real About Money!”

Here are a few pointers for those determined to be well-informed buyers:

-- Factor in your personal economy before deciding how much to spend.

Would buying a well-priced home in a strong neighborhood be a good financial bet for your household if your monthly mortgage payments are more than you can afford? Absolutely not, Tyson says.

Despite still-stringent mortgage standards, it remains possible for many buyers to qualify for a larger mortgage than their finances warrant, thereby placing them at risk of a future default. That’s because your lender knows less about your financial obligations and spending habits than you do.

Before committing to any purchase, even to a small home bought at a bargain price, it’s always wise to review your budget and assess your level of employment security. Is your current job at risk? Do you have easily marketable skills that would allow you to quickly get another job if you had to?

“You probably have lots of job stability if you’re a doctor or nurse. For many in the medical field, a lost job is easily replaceable. But the picture is now very different for people in many other fields, like federal government jobs,” Tyson says.

-- Evaluate neighborhood property values before you bid.

Researching relative property values before you put an offer on a home is critically important in the current market environment, says Tom Early, a real estate broker and past president of the National Association of Exclusive Buyer Agents (naeba.org).

“These days, with tariffs and all, the economy is fairly uncertain at the national level. But what matters more are the trends in the immediate neighborhood where you intend to buy. You want to know what’s sold in the last six months or even more recently,” Early says.

But data on comparable sales won’t give you the whole story. These days, you also need numbers to track the direction of the market. Ask your agent to give you data on the median price of a home sold this past month versus the month prior. Also ask for median price comparisons on an annual and yearly basis. These statistics should give you a good feel for the trend.

Use these data when crafting a bid for a property you like. If selling prices have been weak and inventory is abundant, Early says you can be more aggressive with your opening bid -- offering 10% or more off the market value of the property.

“These days, you might encounter a highly motivated seller whose house has been sitting unsold for a long while,” he says.

-- Don’t rush in a buyer’s market.

During the pandemic, buyers were locked in fierce competition over available homes in desirable neighborhoods. Some properties sold just hours after going on the market, and offers were written hurriedly -- perhaps on the hood of a car. It wasn’t uncommon for sellers to receive multiple bids from buyers offering more than the asking price.

Yes, there are still neighborhoods where buyers must compete. But in an increasing number of areas, buyers are in a stronger position than last year.

“In a buyer’s market like we have now in parts of Florida, you can afford to slow down, pick your house cautiously and minimize the risk of overpaying. You can take your time without fear of losing out,” Tyson says.

(To contact Ellen James Martin, email her at ellenjamesmartin@gmail.com.)