Get pre-approved BEFORE you start your real estate search:
Does it Help to be Pre-Qualified by a Lender?
The pre-qualification process is fairly quick, and is based on less information than a pre-approval. While it is fast and it does help, a pre-qualification letter is an opinion from a lender of the maximum amount of real estate you can qualify for. In a competitive seller’s market, an offer from a buyer with a pre-qualification letter could lose out to a person who is pre-approved. It happens to buyers all the time.
Get Pre-Approved by a Lender:
There are several benefits to going the extra mile and getting a pre-approval letter. First, you’ll know exactly how much real estate you can afford. When you find a property you want to buy, your offer will be in a better position than someone less prepared. Finally, being pre-approved is more efficient, and it reduces the amount of time it will take your lender to fund your loan. Be prepared to provide comprehensive documentation, it is always a requirement. The lender may independently verify certain things like:
- Job and career status
- Your Income
- Monthly debt payments
- Cash available
- Total assets and debts