One of the first questions I ask my clients is if they have a mortgage pre approval. Almost always the answer is “No, we don’t want to get a mortgage pre approval until we find a home we like.” This is a huge mistake. In the current market, sellers have the advantage and there is steep competition for dream homes. The absolute best thing you can do to solidify your position is to get pre-approved before you even begin shopping. Here are just a few reasons why…
Be ready to see a home and make an offer quickly
Often sellers’ agents will only show homes to serious buyers. Especially during the pandemic, sellers often want to be assured that only qualified, pre approved buyers are visiting their home. You don’t want to be scrambling to get a pre-approval and have your dream home go pending before you even see it. Additionally, when inventory is low, the best deals on homes go quickly and often have more than one buyer competing for the same home. How do you show them that you are a serious candidate and deserve a shot at the property? Get pre-approved for a mortgage!
Be informed on your buying power
In today’s lending climate, underwriters are pickier than they have ever been. Often I see even my most qualified buyers scrambling for paperwork up until the day of closing. And I’ve had several clients come across unexpected credit issues when already in contract. You shouldn’t be guessing what you can or cannot afford when you are shopping for a home. And you don’t want to fall in love with a home and then be told you do not qualify for a loan! Getting pre-approved will put you in a better place when home-shopping so you can better target your potential homes without breaking the bank. And applying for a mortgage in advance will give you the time needed to correct any issues that may pop-up on your credit before it’s too late.
Down payment assistance programs
There are many down payment assistance programs for qualified first-time home buyers. There are even some for second time buyers. Getting a mortgage pre-approval before looking at homes allows you time to discuss programs with your mortgage specialist and real estate agent. You might just qualify for more than you think or not need as much of a down payment as you think!
Along the same lines as the above two, understanding your buying power will help you focus on the homes that are actually within your budget and worth checking out. That could save you a lot of time over the entire process!
It brings sellers peace of mind when they see that you have been pre-approved. A certified bank has already vetted you and sellers know that your offer is unlikely to fall through. This gives you the advantage against other buyers on the market who have not been pre-approved.
You could get a better deal
Because you are pre-approved, you will be a more competitive and attractive buyer. Do you know what that means? Better prices! You can leverage your pre-approved status to get a better deal for your home.
Once you find your dream home, the process is a lot faster when you are pre-approved. All of the documents are already in the system. You get to enjoy your new home much sooner than you otherwise would without a pre-approval.
If you have any questions about purchasing a home or you need a referral to a qualified lender, don’t hesitate to contact us. We are happy to recommend a great lender to help you with your pre approval. For a no strings attached home buyer consultation, give me a buzz at 760-840-9455 or email me at [email protected]. I am happy to help!