Reasons to Get a Mortgage Pre-Approval
One you make up your mind to buy your first home, it can be a really exciting time. You might want to run out right away and start house hunting – but in reality, the first step that you should take is to get a mortgage pre-approval. Getting a mortgage pre-approval is important for the following reasons:
- Pre-approval is not the same thing as pre-qualification.
Maybe you have recently received a letter from your bank saying that you have pre-qualified for a mortgage. Some people make the mistake of thinking this is automatically the amount they are approved to borrow. But this isn’t the case.
A pre-qualification is really just a best guess at what kind of mortgage you might be eligible. To truly know how much of a mortgage you can get, you need a pre-approval which takes into account your financial situation.
- Mortgage Pre-approvals let you know how much you can afford.
For the novice home buyer, estimated how much of a house they can afford can be difficult. Mortgage pre-approvals let you know how much of a mortgage you can qualify for so that you won’t waste time looking at a lot of homes that are out of your prices range.
- You have a better chance that your offer will be accepted when you have a mortgage pre-approval.
Competition among buyers in the housing market right now is fierce and bidding wars are not uncommon. Sellers of homes want to know that a potential buyer is serious and actually has the ability to make good on their bid.
Buyers who already have their mortgage pre-approval therefore, often have a better chance of landing the home they want than those who do not yet have their pre-approval.
- Having a pre-approval speeds up the process.
If you would like to move into your new home as quickly as possible, then it is a smart idea to get a mortgage pre-approval. Getting a mortgage involves a lot of steps, so it makes sense to do as much work ahead of time as possible.
- You usually need a mortgage pre-approval before a real estate agent will work with you.
Real estate agents do a lot of work for their clients, but they don’t actually get paid until a sale has been made. For this reason, most real estate agents will want to first see that you are truly serious about buying a home before they will work with you – and that means getting a mortgage pre-approval.
If you are ready to finally own a home of your own and would like to get pre-approved for a mortgage, contact our office today!