Real Estate Corner

Why should I get pre-approved before buying a home?

A. Years ago, buyers didn’t worry about financing their home purchase until after they found the home they wanted to buy. Once they had an accepted offer, they’d shop around for a week or so and then submit a loan application.

Home buying is highly competitive in some areas. To compete, many buyers are now getting pre-approved for a mortgage. This way, the buyer is seen as more stable, has greater influence in negotiating a purchase price, and can act quickly when they find a home they really love. A pre-approved homebuyer is considered almost as strong as a cash buyer.

There are two parts to mortgage approval: 1) approval of the borrower, and 2) approval of the property. Mortgage pre-approval is a process whereby the borrower is approved for a specific mortgage amount. The approval is usually good for a period of time. A property approval is one with satisfactory appraisal and a clear title report. Final mortgage approval also requires a purchase agreement that is signed by the buyer and the seller.

If you’d like free advice on getting the very best financing for your home, or how to get pre-approved for a mortgage, or even refinancing or a home equity loan), please call me at 756-9488.