Why Get Pre-Approved?
“Oh, I’ll just wait until I find a house and take care of the financing then…”
That could be the one phrase that comes back to haunt you one day.
Working in the mortgage industry, I hear from all types of homebuyers—from those who have 20-year plans to those who like living life by the seat of their pants. However, when I am consulting with friends or loved ones about their decisions, I always recommend getting pre-approved for financing BEFORE the hunt for a new home begins. Why? Here are five major reasons.
- You Know Your Limits – You may think you know what type of house you should be looking at, but just because you make a certain amount of money does not mean you will qualify for the loan. A pre-approval gives you more certainty.
- Find Problems Early – When you get preapproved, your mortgage banker will go over your credit history and your background with a fine-tooth comb. If there are problems with your credit report, it is much better to find them, and fix them, now than to wait for a week before you are ready to close on your home.
- You will not Miss the Boat – What would be worse than finding the home of your dreams and then losing it because financing falls through? While pre-approvals are not 100% guaranteed, they do give you a much higher sense of security than entering into the buying process with no financing in place.
- Building Relationships – Your mortgage banker will have a critical part in your home buying journey. Building that relationship today will make the entire home buying process that much easier.
- It Gives You Bargaining Power – Mentioning you are pre-approved when you put in an offer for a home helps you stand out from other offers. Sellers are more confident about your offer and are thus more likely to say YES.
If you want to talk to an expert about the mortgage pre-approval process, reach out to us at Liberty Financial. We can provide you with some guidance and even help you begin the pre-approval process today. If you live in or around Louisville, we would love to be your go-to mortgage company.