Congratulations! You’ve taken a big step and decided to start shopping for a new home. This is an exciting, scary, and competitive process, so it’s important you set yourself apart from others in the highly competitive home buying market.
One way you can do that is to get pre-approved for a mortgage. Obtaining pre-approval means you have proof that a lender is willing to provide a specific maximum mortgage amount and a stated interest rate. Getting pre-approved gives you an estimate of how much money you could borrow so you’ll know what type of house you can afford. It also shows sellers how creditworthy you are. It can also make you more appealing compared to other potential buyers.
It’s best to seek pre-approval from several lenders to make sure you’re receiving the best rates. You’ll need to supply your Social Security number so the lender can do a credit check. Other pieces of information you’ll need to provide include a list of assets and liabilities, documentation of job history, and income tax returns. After reviewing your application, the lender will offer pre-approval, grant pre-approval with certain conditions, or deny the pre-approval.
Once you are pre-approved, you receive a document or letter that states how much money the lender will let you borrow to pay for the home. This letter specifies that as long as the home meets certain criteria and your financial situation doesn’t change drastically while you’re searching for a home, the lender agrees to give you the loan. These letters are typically valid for 60 to 90 days.
Seeking pre-approval can put you in a stronger position to purchase a home. If you need more information about pre-approvals or want to get started on the process, reach out to a real estate broker.
Sources: Bankrate.com, Investopedia.com, Keepingcurrentmatters.com
We are ready to help you find the best possible mortgage solution for your situation. Contact Sheila Siegel at Synergy Financial Group today.
