You’ve decide it’s time to buy a house. You are excited to start looking at all the homes available. If you are like 87% of the buyers you will probably begin your search online. You find a few homes you like and can’t wait to see them. You call a REALTOR only to be asked if you have been pre-approved. Are you? Do you know it means to be pre-approved? No? Kind of? Let me explain.

When you decide to purchase your first home or even if you are veteran to the home buying business you should first find a lender (most REALTORS can recommend someone) that can tell you how much you can spend on a home.

When you are pre-approved by a lender that means you have filled out a loan application and the lender has examined your financial situation and will put in writing their commitment to fund a loan. You are not committed to borrow the money, but getting pre-approved allows you to move quickly when you find the home of your dreams.

Many buyers wonder why they are discouraged from looking at homes prior to being pre-approved for a loan. Often times our wishes are greater than what we can actually afford. The pre-approval process will confirm a price range that the buyer can comfortably shop. Plus getting pre-approved lets the buyer know where they stand financially. For example: Do you have outstanding debt that needs to be paid? Are there any negative remarks on your credit report? Do you know your credit score and what is your debt to income ratio?

The pre-approval process will allow any seller to have confidence in your offer as they know you are a serious buyer, as your financial status is not in question.

Next week learn how the pre-approval process can also be used as leverage in your offer.

Happy House Hunting!
Yvette