Why Do We Need To Get Pre-Approved?

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Signing papersWhy do we need to get pre-approved?  

This  is a  question many potential home buyers ask, especially first-time buyers.


That’s a great question!

Here are a few things that hopefully will help you answer that question.


It’s always fun to look at homes and dream, but while idly shopping for a home may be enjoyable, it can be a serious waste of your time and the time of your realtor if you are not looking at homes you can afford.  In today’s market, most Realtors suggest that earnest home buyers have a pre-approval letter from a lender before starting the process of finding them that perfect house — one they can afford. No one wants to absolutely fall in love with the house of their dreams, only to learn they can only afford “half” of it.

Learning ahead of time the maximum you can borrow, and the payment you can comfortably live with for long-term debt makes the process much easier.  It is sometimes tempting to aim for the top of your spending ability, but buyers need to consider all the aspects of this decision for the long-haul.

Another reason to obtain pre-approval before shopping is that sometimes sellers may be more willing to negotiate with people who have taken the time to obtain proof that they can afford to buy a piece of property.  Showing that you have given this decision a lot of thought will certainly reassure a seller that you are not just acting on a whim.

By starting your home search with a pre-approval, you eliminate that fear of “Oh, my gosh, I just love this house, but what if we don’t qualify?”  Once you’ve made a decision on the property, you are headed to final loan approval, which occurs when you have an appraisal done, the loan is applied to a particular property, and all of the documentation is complete.

Next step – Close the transaction and MOVE IN!    Welcome home.


First Time Home Buyers