Wondering about whether or not you should get pre-approved?
The answer is Definitely!
Most mortgage lenders take the guess work out of applying for a loan by figuring out for you the amount you can afford to borrow. Then they can provide you a printed document stating the maximum mortgage amount you qualify for based on your particular finances and income.
Mortgage pre-approval establishes your price range and strengthens your buying position by letting the Seller know that you have already been approved for the loan. It can also ease time constraints once the purchase agreement in signed between Buyer and Seller.
Consider the following Scenarios:
You're out looking at homes with your REALTOR. You find the perfect house and work out a great offer with the Seller. Three weeks later, the lender informs you that the house is $10,000 over what you qualify for and does not approve your loan. The Seller has already bought another house. You've given notice where you're renting and told all your friends about the beautiful new house you bought. Also at this point you may have spent money on inspections in order to fulfil your conditions - however this will not be reimbursed to you, even though you can't own the house.
You and your REALTOR have been working diligently finding that "perfect" home. A new listing comes on the market that's priced right and has got everything you've been looking for. You write an offer. Your REALTOR takes it to the listing REALTOR and is informed that another offer is coming in and will have to present both offers simultaneously to the Seller. The other Buyer is pre-approved for his loan. Whose offer do you think the Seller will negotiate first??
We always recommend getting pre-approved so that you are in the best position when viewing homes. If you want any further advice about getting pre-approved then contact us.