Getting pre-approved means a visit or two to a couple of different banks and mortgage companies who are ready to loan you the money to buy your next home and begin your new life. The Consumer Financial Protection Bureau allows for a 14-day window in which you can have your credit pulled as many times as you want and your credit will only drop 1-3 points at the most. This allows consumers to look around and find the best rates and financial advice. You’re safe to shop around. There are two very important reasons for getting all the financial information as soon as possible before you start looking for your new home.
Money
Very few of us have unlimited funds to purchase a new home so one of the best ways to begin the search is by first knowing what you have to spend. Getting pre-approved will ensure that you look for and make offers on homes within your budget. Knowing what you have to spend is the first rule of shopping, right?
The expertise of a loan officer, like local Jason Martin, will help you save money by advising you on how to apply your down payment. Martin says that a good loan officer can tell you how to best use your funds, like whether to pay down debt or buy a car while you are shopping for a house. “Beware of loved ones,” he says. They mean well but they are basing their opinions on old information.” A loan officer will ensure you get the most up-to-date financial information.
Time
Getting pre-approved will help you shape your search. You can quickly and efficiently weed out homes that are outside your budget and help you focus on what’s possible for you and your family. Show the sellers how serious you are. In this market, there are more buyers than houses so the competition is steep. A pre-approval letter is like a VIP pass, sending you right to the beginning of the line. During the pre-approval process, you may discover that there are ways you can repair your credit. Seeing a loan officer early will give you the time you need to make changes before you make an offer on your dream home. You will also reach the finish line quicker since your financial information is collected and in the system. Before you know it, you’ll be at the closing table signing for your new home.
I know you are excited to get out there and start touring houses. This is an exciting moment! Perhaps applying for a loan seems overwhelming and complicated. Martin says, “This makes sense to me so I am able to help it make sense to you.” In this way you can make the best financial decisions for your family. Taking the time to get pre-approved is worth it to ensure you are confident, organized, and ready to make an offer on your dream home.