Should I Be Preapproved Before Home Shopping
At MortgageDepot, Inc. we strive to maximize the chance that each of our clients will be able to buy the home of their dreams. That’s why we recommend that before going home shopping, you take time to get pre-approved for a loan.
Three Reasons Why You Should Get Pre-Approved
1. Identify underwriting challenges early
The pre-approval process mimics the final loan approval process, and lets you know early if there’s any action you need to take in order to secure financing. Once you make an offer on a house it’s too late to clear up credit issues, liquefy assets, and improve debt-to-income ratios or season funds for a down payment.
2. Identify your price range
The home shopping process can be daunting. You and your buyer’s agent only have so many hours available for showings. The best way to focus your efforts is to clarify your price range. If your range tops out at $500,000 and you want a 3-bedroom, 2-bath home, that narrows down which neighborhoods and which types of homes might be a fit.
3. Legitimize your offer
When the time comes to make an offer on a home, negotiate from a position of strength. By showing the seller that you have a clear path to financing, the biggest barrier to closing the sale is lifted. This gives your agent the chance to negotiate the best price possible on the home and to have a strong negotiating position throughout the inspection and the mortgage process.
Now that you see why it’s so important to get pre-approved, take time to get prepared by accumulating all the necessary documentation to start the process.
When you call us for a mortgage pre-approval, the first thing we do is fill out a basic loan application. For that, we need your name, your social security number and your employment information. Next, we verify your income and assets, which requires 2 recent pay stubs, the past 2 months’ bank statements, the past 2 years’ tax returns, and proof of funds for down payment and closing cost expenses. If you’re self-employed or in need of non-conventional financing, additional documents may also be needed.
If you’d like to get pre-approved for a mortgage, contact us at today! One of our experienced mortgage professionals will quickly analyze your financial picture and help you eliminate all potential obstacles between you and success, so you can go home shopping with confidence.