In a competitive homebuying market, sellers want to sell their homes quickly to someone who will be able to buy it with no issues. A pre-approval letter is an official document explaining the mortgage amount you can afford based on your income, debt, and assets. This gives you an idea of the price range you can afford and tells the buyer you’re serious about the offer you’re making.
Benefits of Pre-approval
- Pre-approval gives you financial insight – When you get pre-approved, you’ll get more granular information about your unique financial situation that you may not have had before.
- Pre-approval makes you a competitive buyer – In many areas, sellers will not consider an offer from a buyer unless there’s a pre-approval letter, leaving you at risk to be overlooked in favor of another candidate who is pre-approved. This could be the difference between getting your dream home and missing out on the opportunity.
- Pre-approval demonstrates you are serious about buying – Sellers will see you as further invested in the process than someone who hasn’t taken the time and effort to have their financial information pre-approved.
How to Start the Pre-approval Process
Starting the pre-approval process is easier than you think. Here’s how:
- Get in contact with a Mortgage Loan Originator (MLO) – Reach out to a Homebridge MLO in your area
- Pre-approval checklist – Your MLO will give you a pre-approval checklist to make sure you have all the necessary documents. Download the checklist here, so you’re ready for your meeting at their office.
- Get all your documents in order – Being organized helps when it comes time to gather the paperwork required for pre-approval. Make sure you have all your documents in one file.
- Credit Check – Next, your MLO will run your credit to help generate your pre-approval letter.
If you’re dreaming of that fancy house on the block finally being the place you call home, you can bet that others are too. Getting pre-approved ensures you’re ready once that home hits the market!
Now that you’re great to get pre-approved, it’s time to set your expectations on the homebuying process!