The Importance of a Pre-Approval
Before looking for a home, receiving a pre-approval is an essential part of the home-buying process. Here are some key reasons why it’s critical to get pre-approved for a mortgage before falling in love with your dream home.
What is mortgage pre-approval?
Pre-approval provides buyers with important information that helps with their home search. After getting pre-approved for a mortgage, you can find out the maximum amount you’ll be able to spend on a home, the monthly mortgage payment associated with your total purchase price, and what your rate would be for your first mortgage term.
Your mortgage pre-approval proves to realtors and home-builders that you are a qualified buyer. It also prevents you from looking at homes you might not be able to afford.
Why is pre-approval necessary?
Mortgage pre-approval helps take the pressure off your home search, helping to make it more of a stress-free, enjoyable experience.
An important thing to remember is that it’s not just the purchase price you need to keep in mind when you buy your home. Factors such as property taxes and utility bills tend to surprise first-time buyers. The pre-approval process helps to clarify all costs associated with purchasing your home.
Lastly, mortgage pre-approval is essential for the seller, as it is evidence that you’re serious about buying. A pre-approval letter can assure property owners that you are qualified for the home you’re interested in buying.
We’ve got a few quick tips to help you through the process of getting pre-approved:
- It’s best to begin the pre-approval process as early as possible. This ensures you have ample time to develop your clear mortgage plan after consulting with a mortgage advisor.
- To ensure peace of mind, meet with a professional you trust.
- Understand what lender’s are looking for in regards to your credit score and position yourself appropriately. We’re experts when it comes to reviewing your credit report. Ask us about how you can quickly improve your score.
- A pre-approval doesn’t mean you’re stuck with one lender. Know you have options.
- Most pre-approvals are good for 3 months, but will vary by lender. So long as your income or credit doesn’t drastically change after the fact, then your approval generally stands (assuming a stable rate environment).