If you find yourself in the midst of searching for a new home, completing the process for mortgage pre-approval helps you stand out in a competitive market. Not really sure what pre-approval is and a little intimidated by the process? We get it, and we’re here to help.
Pre-approval simply means that a loan officer has looked at your finances and given you a letter of approval detailing how much you can borrow, your monthly payment, and your interest rate. It provides a great way for sellers to know that you’re serious about buying a home — and are able to qualify for a mortgage.
We’ve broken down the benefits and the process of getting pre-approved to help you get a leg up on the home-buying process!
Why You Should Get Pre-Approved
Getting pre-approved for a mortgage is usually pretty straightforward and provides tons of benefits in the home-buying process. Think of it as the real estate equivalent of getting to cut in line. Here are some pretty compelling reasons for getting pre-approved before buying your next home.
Peace of Mind
We know buying a home can get a little stressful. Any little thing that can help put your mind at ease during the search is well-worth it. Getting pre-approved helps you know that your finances are looking good. It also gives you a realistic look at how much you can spend.
Plus, if any issues come up during the process like errors in processing your credit score, then you have plenty of time to get them resolved before you talk to a seller.
Preferential Treatment
What’s the difference between a pre-approved buyer and a buyer who hasn’t been approved? Proof! Getting pre-approved is like turning in your homework a week early; you’re showing the seller that you’re serious, and you’ve got the funds to back your offer. Compared to a buyer with no proof, your offer comes off as much stronger and will be much more attractive to a seller.
Pre-approval has become incredibly common in some areas. There are even certain sellers that prefer to only accept offers from pre-approved buyers!
A Quicker Process
Since you’ve already submitted your financial information to a lender and ironed out any issues, the process of finalizing your loan goes significantly quicker. Shopping for a home in a competitive market? Getting pre-approved means you can have your offer and finances in order well before other buyers.
Getting pre-approved means staying one step ahead of the crowd when buying your dream home. The whole process can be done in as short as 24 hours, and you won’t regret the time it saves you in the end!
The Pre-Approval Process
Now that you’re convinced that getting pre-approved is totally worth it, you might be wondering how to get started with the process. You’re going to need a hefty stack of documents to bring to your lender or have ready to submit online, but don’t let that intimidate you. Make a list, check it twice, and you’ll be good to go.
What You’ll Need
You should have a few different forms of basic ID with you, like a driver’s license, passport, or Social Security card.
You’ll also want to have records of your income like recent pay stubs, W-2 forms, and personal and business tax returns.
Lastly, be sure to bring proof of any assets you have. Bank statements that include asset accounts as well as a gift letter from anyone helping with the payments will be necessary.
If you think you might have forgotten something, you can always double-check with your lender.
The Timeline
If you arrive prepared , the process could take as little as 24 hours. There are a few things that can slow you down, however, like low credit or outstanding debts. That’s not to say that you can’t get pre-approved if you have those issues, but it will likely slow down the process.
Find Your New Home with Ann Milton Realty
Buying a new home doesn’t have to be scary or stressful. Let the team at Ann Milton Realty give you a hand in finding your dream home! With years of experience, we provide the expertise to make your home-buying search as smooth as possible.
Contact us for more information or to schedule a showing!