Why Pre-Approval of a Home loan is Important
Nichole Whitmire, Cumming, GA Real Estate Associate | RE/MAX Regency (remax.com)
When you decide you're ready to become a homeowner, one of the most important preparation steps is to get pre-approved for your home loan. Here's a few reasons listed below why pre-approval matters.
Let's you know any credit issues that need attention beforehand. Getting pre-approved for your home loan means your lender will evaluate your credit resulting in your awareness of any issues. Potential credit issues could catch you by surprise and cause you to miss out on your dream home if waiting to seek a lender after your home search has begun.
Let's you know your price limits of your potential new home. Knowing the price range of your pre-approved home loan allows the Realtor and you to focus on properties that fit your wishes and your budget. This prevents unnecessary letdowns on homes that may be outside of your target.
Let's Sellers know your serious. In today's housing market, seller's many times are receiving multiple offers for their properties. Your pre-approval letter helps the seller to know that you have your financing in order and may help you to stand out amongst the other bidders.
Let's you get an idea of how to plan your new budget as a homeowner. Pre-approval of your loan gives you an idea of what your monthly mortgage could be which in turn allows you to begin planning/adjusting your annual financial budget plans. Though your pre-approval monthly mortgage amount likely wouldn't be exact, you would have a starting point to think about any adjustments you may need to make with a new mortgage.
All these reasons listed above support the practice of seeking loan pre-approval prior to beginning your home buying process, in the effort to help make your home buying experience smoother.