Getting preapproved for a mortgage is an important part of the home buying process. While technically not required before you begin your home search, there are some key advantages to getting preapproval from a lender before you get too deep into the process.
Here are some of the main reasons why to consider getting preapproved for a mortgage:
Cost is one of the major factors you’ll be dealing with in finding a new home. A house is a significant investment and one of the biggest purchases you’re likely to make, so it’s crucial to understand your financial situation clearly early on.
Mortgage lenders will examine your finances, using things like credit history, investment account statements and debt-to-income ratio.
With this careful analysis of your financial situation, a mortgage preapproval can help you determine how much you can afford to spend on a house before you start looking. It will help you estimate how much of a down payment you can offer and how high an interest rate you can comfortably afford while paying back your mortgage.
The real estate market is constantly changing, both across the country and across your local area. Economic shifts can make a huge difference in the availability of homes for sale and their prices. It can also make a difference in how much competition you’ll have for the same property.
Getting mortgage preapproval will give you an advantage over other potential buyers because it will communicate to sellers that you’re financially qualified and less of a risk.
As long as you don’t make any major changes that could affect your financial status, having mortgage preapproval shows you have the financing to back you up. Sellers may be more likely to choose you over another buyer if they have the reassurance of your mortgage preapproval letter.
While the mortgage preapproval process itself might seem daunting and complicated, the benefits can certainly outweigh the inconvenience. Keep these advantages in mind when considering whether to get preapproved for a mortgage.
“Whether moving across town or around the world.. My Global Partners and I will handle all the details”
Marsha Collins-Mroz, Broker, "Global Partners in Real Estate"
Marsha brings her combined 46 years of successful real estate brokerage experience and expertise to every transaction. Recognizing the overwhelming demand for personalized and objective consulting services and assistance, Marsha expanded her business model to a national and international scale. She consults and oversees the acquisition and disposition of primary residences, vacation/second homes, and commercial real estate. And presents on U.S. opportunities in Europe, Asia, and the United States. Her personally vetted network of Global Partners are uniquely skilled and positioned to assist with the needs of her clients; focusing on advancing their knowledge of local markets and opportunities, empowering them to make informed decisions.
