What is a Mortgage Pre-Approval Letter?
Buying a home is an exciting step, and while looking at homes can be fun, it’s important to know how much you can truly afford before you take that leap.
It is important, in terms of lending, to understand the difference between being pre-qualified and pre-approved and why a pre-approval letter is vital before you start your search.
Connect with a Realtor and Lender Before Starting Your Home Search!
Many people don’t know that the right time to connect with a realtor and lender is a few months prior to when you’re really ready to start searching.
This is especially important if you are a first-time homebuyer, newly starting the process again, or trying to determine if you should rent or buy.
Considering the financials ahead of time, helps set your expectations. It also gives you time to clear up any financial issues necessary, and puts you in the strongest position to borrow from a lender, when you are ready!
Why get a Pre Approval Letter?
Looking at homes that are outside your budget or stretch you too far financially, can leave you feeling disappointed about what you can’t afford, instead of feeling excited about what you can!
If you’re pre-approved to borrow $275,000 and you have $25,000 for a down payment, you’ll know not to look at a $375,000 home. It’s that simple!
This is why a pre-approval letter also strengthens any offer you make by letting sellers and real estate agents know you’re a serious buyer and can afford the amount you’re offering.
If you’re in a bidding war on a home, sometimes a pre-approval letter will entice the seller to choose your offer over another because they know you’re able to financially see the offer through to closing.
Free Essential Buyers Guide for More Helpful Info
You can find more information on this and other helpful homebuying tips in my free buyers guide here.
