Do I need to get pre-approved for a mortgage before viewing homes?

Mortgage Pre-Approval“Why are you asking me if I have been pre-approved for a mortgage already? We haven’t even looked at homes yet.”

I get this question from buyer clients all the time when I ask them if they are pre-approved in our initial buyer consultation.

Either that or, when I ask a new client for their pre-approval, I receive responses stating that they are sure they are fine for a mortgage and that their credit is good.

So why do I persist and make sure my clients get pre-approved for a mortgage?  First, try to remember, as your buyer agent, I am on your side!  And one of the first steps in the buying process is receiving a pre-approval letter from a Mortgage Lender.

7 Reasons to Get Pre-Approved for a mortgage before viewing homes

1. I don’t want you to be disappointed when you locate a property and cannot make an offer. Given all the turmoil in the financial markets, there are virtually no sellers who will even look at your offer without a pre-approval – never mind accept it.

2. I want you to understand your buying power. Not only how much you qualify for in a mortgage but how much you are actually comfortable spending.  Getting pre-approved for a mortgage and understanding the costs involved in buying a home helps you discover that.

3. Did you know that the credit used by a mortgage company is different than the credit reports you can get online? Guess which one the mortgage company will want to use? You need to make sure you’re seeing the same credit report the mortgage lenders are.

4. Have you had your credit pulled to make sure there are no errors that could adversely hurt your credit?  Did you know that a good mortgage lender can help you correct any mistakes? They can also work with you to bring your credit score up!

5. I want you to understand how much money you can and should use for a down payment.  Your down payment can seriously affect the type of loan you can get AND the type of property you can buy.  For instance, if you are going the for a low down payment loan (like an FHA 3 ½% down loan), there are some condos you cannot purchase (more to come in another blog…stay tuned).

6. Do you really know the difference between a 30 year fixed and an adjustable (ARM) loan? Depending on your needs, one or the other may be a much better option. And again, there are some condos that you will not be able to buy depending upon which loan you choose.

7. Are you self employed? Or have a short job history? Most banks require a 2 years of income tax returns. But there are lenders who will work with you and make sure you can qualify for a loan that suits your needs.

These are a few of the reasons that I am asking you to get pre-approved. If you have questions, ask them in the comments below or please schedule a buyer consultation with me.  I am happy to meet with you privately to review your home buying and financing needs!


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