The Importance of Getting Pre-Approved

What does it mean to get pre-approved for a home loan? Is this helpful? Is it something that everyone should do? These are just a few of the questions that people ask when they are starting their search for their first home or their third home. Anytime that you are looking to buy, having pre-approval is going to help you out immensely in the process. But, what is this and why is it so important?

What is Pre-Approval

When you are pre-approved for a loan, this is the amount of money that you are going to get for the home, car or whatever you are taking the loan out for. This pre-approval is like the golden ticket when looking to buy, as it gives you the exact knowledge of what you can and cannot afford.

Why Pre-Approval Is Important

Why is getting pre-approval so important? There are several reasons which include:

  • Many sellers will not work with those who are not pre-approved. When trying to buy a home in a buyer heavy market, you will find that anything you can do to make your offer go through, you need to do. And having pre-approval is one of those things that you can do. This gives you a starting and ending point in terms of how much you can afford to spend on the item that you are getting a loan for.
  • There are no surprises when you have pre-approval. You do not have to go through the process of finding a new home only to be told that this is out of your budget or that you do not qualify for this high dollar loan.
  • Did you know that when you have pre-approval you can actually close on a house faster? In fact, it is estimated that if you have pre-approval, find a home, make an offer and everything goes as planned, you could close on a home within 30 days!

What Goes into Getting Pre-Approved

 In order to get pre-approved for a mortgage or any other type of loan, you have to provide your financial stability to the lender. This means gathering all the financial documents that prove how much you earn, your other bills and the like. You then find the lender that you are wanting to go with, or you can choose to go with a broker you will find you the best terms. You complete a loan application and then you later receive a pre-approval letter from the lender or broker.

This pre-approval letter is your golden ticket to making a deal with a seller on a home. This shows that you do have the finances to buy the home and are serious about buying.

For those who are in the process of wanting to buy a home, the pre-approval should be your first step. This will give you all the information that you need to help with the buying process, in knowing what you can and cannot afford. Not only can I help you find your next home, but I am a licensed Mortgage Broker with Invis in the province of Alberta. Let me help make your home buying experience easier, faster, and way more fun!! Sonia is your one stop shop for all your Mortgage and Real Estate needs!

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