If you’ve been planning to buy a home this year, then you might have heard of the term “pre-approval” being thrown around and that’s because it’s a necessary step to take before starting your journey as a homeowner. But, have you ever wondered why that’s the case and how come pre-approvals are so important?
Well, the truth is, getting a pre-approval letter from your lender is critical, and can give you an advantage from your competitors (other buyers) in so many ways.
To better enlighten you on why it’s important to know what “pre-approval is”, Freddie Mac defines the process like so:
“A pre-approval is an indication from your lender that they are willing to lend you a certain amount of money to buy your future home. The lender you work with will provide you with a pre-approval letter, which is an official document that states the maximum amount they are willing to lend you, . . .”
In simple terms, pre-approval from your lender helps your get an idea of how much you can realistically afford and how much you can borrow for your loan. That makes it easier for you to put a bar on your search for homes. And since you have an idea what you’re approved for, it’ll also be useful when it’s time to submit an offer on the home of your dreams.
You should take every advantage you can gain as buyer in this market that been drastically changing. It’s really crucial that you do this so that your offer does not get lost in the sea of other offers, especially those who have been pre-approved also. To do this, you’re going to need the guidance to navigate these new waters, so another important factor is to have a team of professionals on your team, such as a real estate advisor and a trusted lender. They’ll make sure to put your best foot forward.
Pre-approval for a mortgage gives you a better understanding of how much you can borrow and shows sellers just how serious you are about purchasing their home. Let’s connect so you have the tools you need to succeed as a homebuyer in today’s shifting market.