Skip to main content

Ready to buy a home? Have you been pre-approved for a loan?

Are you ready to buy a home? Have you been pre-approved?

 We are now in a seller's market which makes the home buying process very competitive. Multiple offers on properties are becoming more common so it's crucial for buyers to be prepared. Any small advantage, may make the difference between being accepted or denied.

 If you plan on financing your property it is important to get pre-approved for a loan. There is a difference between pre-qualification and pre-approval. A pre-qualification can be done by phone and most, if not all, the information provided is verbal. A Pre-qualification is based on what you disclose to the lender about your earnings, credit score and assets. A pre-qualification gives you a simple idea of the range of price you might be able to afford. This carries no weight for a seller.

 A pre-approval requires a borrower to provide documentation of their income and assets. The lender will also run a credit report and score. The bank will require tax documentation, pay stubs, bank statements, 401K statement, among other documents.

 The lender will review all this information and provide you with a more accurate price range. That said, there is no 100% guarantee that the bank will lend you the funds but this is the closest you will get before you find a property you would like to purchase. 

A pre-approval is very important with home shopping. Strive to get your pre-approval letter 30-90 days before your target move date. Most letters will expire within 90 days.

 There are many other advantages such as the ones listed below:
  1. A pre-approval will carry more weight with sellers. A pre-approval letter tells them that your lender has reviewed your financials and you are eligible for a home loan in their price range. Your lender will provide you with a pre-approval letter that will be submitted along with your offer.
  2. Lender will provide you with a good faith estimate that will give you an estimate of down payment, closing costs and mortgage payment. This will allow you to make a more informed decision when home shopping. 
  3. You will know in advance the amount you can confidently afford/offer when you find the right home. There is no guess work.
  4. The process will inform you of any credit issues that might need to be resolved before you official apply for a loan. Your lender can make some recommendations that might help you better your loan options.
  5. You will have the opportunity to review loan options with your mortgage lender. The most common option is a 30 year fixed interest rate loan but that is not always the best options for all buyers. For those buyers that will be in a home for less than 5 years, there are other options that might make more sense.
  6. Being pre-approved will speed up the mortgage process and can lead to a shorter closing period.
It's never too early to speak to your mortgage lender. Give yourself time to consult with your lender and make corrections if needed. You can schedule a meeting for a mortgage lender to simply review your financial goals and strategies to buy a home.

Remember, just because your bank pre-approves you for a certain amount, that does not mean that you have to borrow that balance. Review your finances and figure out what is best for you. Give yourself some wiggle room so that you have funds for the fun things in life. 

If you need a mortgage lender referral or if you have any other questions, please feel free to contact me anytime.


If you have any questions or if you would like assistance in buying, selling or renting give me a call. I'm happy to help.



Ali Palacios, ABR, MCNE, TAHS
Realtor
Today's Home Realty
ali.palacios@todayshomerealty.com
Mobile - 832-418-0670
Fax - 832-201-7492
www.todayshomerealty.com
www.ilovehappyclients.com

9119 Hwy 6 S #230-116, Missouri City, TX 77459


Home buyers and sellers beware: http://homes-sale-richmond-texas.blogspot.com/2016/02/home-buyers-and-seller-beware-wire.html
Rental fraud alert: http://homes-sale-richmond-texas.blogspot.com/2016/02/rental-fraud-alert-texas-luz-astacio.html



About me: http://www.ilovehappyclients.com
Professional Memberships:

  • Houston Association of Realtors®
  • Texas Association of Realtors®
  • National Association of Realtors®
  • Accredited Buyer’s Representative – ABR
  • Master Certified Negotiation Expert – MCNE
  • Accredited Staging Professional – ASP®
  • Texas Affordable Housing Specialist – TAHS
  • Women’s Council of Realtors®
  • National Association of Gay & Lesbian Real Estate


Hablo Español

Comments

Post a Comment

Popular posts from this blog

‘Tis the Season: 5 Reasons Why Winter is a Great Time to Buy or Sell a Home

‘Tis the Season: 5 Reasons Why Winter is a Great Time to Buy or Sell a Home It’s a common misconception that you shouldn’t try to buy or sell a home during the fall and winter months.  This is generally considered the “offseason” in real estate. Many sellers mistakenly believe that the cold weather will keep buyers away and that no one is looking over the holidays. Unfortunately, many real estate professionals perpetuate this myth by advising their clients to “wait until the spring” to list their home.  The truth is, homes are bought and sold year round. And while the market is typically quieter during the fall and winter, savvy buyers and sellers know how to use this slow down to their advantage. In fact, depending on your circumstances, now may be the  ideal  time for you to purchase or list a home. If you’re in the market to buy or sell, there’s no need to wait for the spring. Read on to discover the top five reasons that it can pay to ...
Post a Comment
Read more

Should You Go Directly To The Listing Agent When Buying A House?

When you’re looking to buy a house, you might think it makes sense to go directly to the agent who’s listed the property for sale. Some of the more common reasons people give for doing so are: Why  not ? Doesn’t it just make sense… The agent listed the property and is the one selling it. They know all about the house.  They know all about the owner, so maybe you can get some inside scoop and a better deal than if you had your own buyer’s agent in the mix. Isn’t it like buying a car? You have to go to the dealer selling the car, so don’t you go to the agent who’s selling the house? Some people say they just didn’t know any better. It’s just easier than finding and working with a buyer’s agent. It’ll be easier to deal with owner. And, last but not least, if the agent is representing both the buyer and the seller, people feel like the agent will get them a lower price. Either because the agent is getting “both ends of the deal”, and therefore making more money, so th...
Post a Comment
Read more

How To Get Your Roommate To Pay YOUR Rent

Rent isn’t cheap. It’s tough to afford a place on your own. So, you have roommates. Maybe it’s a friend or two. Maybe more.  But it certainly beats living “alone”…in your parent’s basement. But you’re still not banking money… You’re saving some money by renting with others. But not tons.  It certainly makes your housing costs more affordable, but it isn’t like you have so much extra every month to just go out and spend on whatever you want. So, it’s probably hard to even imagine saving enough to eventually  buy  a house. You figure that day will come eventually. But not anytime soon. You’ll figure it out someday. Probably not until you find someone you want to settle down with. Not until you and a significant other can combine forces (and bank accounts) to make that dream happen.  But, at this point, you wrap that thought up with a nice bow and put it on a shelf.  You rationalize it, and think… I’m still young. I’m  too  ...
Post a Comment
Read more