Why Get Pre-Approved

There are 3 people who will benefit from your pre-approval: You, your Agent, and the seller from whom you eventually buy a home!

You: Getting pre-approved for a mortgage is a simple step, but it is an important one. It’s the first step in formally applying for a mortgage, and it gives everyone involved, including you, a clear picture of what you can afford, both with a purchase price and a monthly payment.

Your Agent: It does no one any good to look at homes you are not qualified to purchase. You may want a 4000 square foot pool home for $250,000, however, if you only qualify for $150,000, that is the price range that you need to focus on. By knowing what your financial parameters are, your Agent can spend more time looking for homes that you can actually buy and less time pursuing dead ends.

The Seller: The real estate market has changed over the past few years. Sellers are not willing to take their home off the market unless they feel comfortable that the buyer is qualified to purchase it. Having a pre-approval letter strengthen your bargaining position. It also will give you an advantage if there are multiple offers for the same house.

Once you find the home you are going to purchase, you’ll still need to go through the formal loan approval process with a mortgage lender. The lender will run a credit check on you and review your credit score. Based on that information you would be approved for a loan.