Increase Your Credibility As A Home Buyer: Get A Mortgage Pre-Approval
It used to be that buyers could go house shopping and when they have found their dream home, then they get pre-approved. However, in today’s market, that has proven to be one of the least effective methods in landing a dream home.
Many, if not most, sellers require buyers to submit a pre-approval along with their offer to purchase. This is especially true in the competitive lake house market around Lake Wallenpaupack, The Hideout, and other areas. More and more realtors are requiring pre-approvals before making appointments to show homes.
Most lenders can pre-qualify you for a mortgage over the phone. Based on general questions about your income, debt, assets, and credit history, lenders can estimate how much mortgage you qualify for. However, being pre-qualified and pre-approved are different things. Pre-approval means that you have applied for a mortgage; you have filled out the mortgage application, received your credit report, and verified your employment, assets, etc.
When you are pre-approved, you know exactly what the maximum loan amount will be. Some lenders take it a step further and offer underwritten pre-approvals. These carry the most weight, because they have already been through a rigorous qualification process: your information has already been submitted to underwriters for approval, not just the mortgage broker.
A pre-qualified letter is not verified and does not count for much if you are competing with other buyers who are pre-approved. When you are pre-approved, you and the seller know exactly how much house you can afford. It gives you major credibility as an interested buyer and lets the seller know immediately that you will qualify for a loan to buy their property.
In addition to being pre-approved, it’s important to be pre-approved with a trusted lender. Trusted lenders include: banks, mortgage bankers, credit unions, savings and loan associations, mortgage brokers, and online lenders.
Usually real estate agents prefer approvals from local lenders who are known to them and are locally trusted. Some “big banks” and “national brands” (who heavily advertise on TV and the internet, for instance) are not as well received as local lenders.
Why? Shouldn’t a pre-approval from a big bank carry more credibility? Actually, they often don’t, because their approval process may not be as vigorous as a local lender. Additionally, big banks often lack flexibility to accommodate loans and purchases that are not perfectly perfect. Trusted local lenders can offer a number of solutions when unique issues arise.
Lenders to avoid: those who are non-responsive, who do not communicate well, who lose forms or misplace files, who gather information from you in an unorganized manner, those who repeatedly ask for the same information over and over, and those who cannot provide you with the right information.
Are you looking to purchase a lake house or home in the Northern Poconos? With 16 years of experience selling properties in the area, I am proud to have established a network of trusted lenders in Northeastern Pennsylvania. With these mortgage professionals, I am able to provide buyers with a credible pre-approval for their new property. This pre-approval gives potential buyers the confidence and ability to pursue their dream home without worrying about being denied financing.
