Do I Really Need Mortgage Pre-approval?

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The answer is a resounding YES.

Think of it this way. You never head out to the mall or any sort of department store without your wallet or debit card. You know exactly what's in your bank account, how much you have budgeted to spend, and what type of deals you're looking for.

The same should go for the home buying process. Without having a mortgage pre-approval in your hand first, you really have no idea how much home you can afford to buy. And that in itself is a two-part problem, because the amount of your pre-approval may not necessarily be the amount you can actually afford in your budget at the end of every day.


Going to the lender and asking to go through the pre-approval process will do a couple of things for you. First, it helps you to avoid getting your hopes up. There's nothing like finding your dream home and then ultimately finding your credit still isn't good enough for you to get a loan, thus making you incapable of placing a bid.

Second, pre-approval allows you to set boundaries and guidelines. You know how much you have to spend and what your monthly mortgage payment might be. You can then decide what actual price range you really want to shop in, and how close to the maximum limit you want to get. Doing that will help you to immediately put aside listings that just aren't in your range.

And, truth? A lot of real estate brokers won't even talk to you if you don't have a pre-approval letter. That means a real letter. A pre-authorization and a pre-approval are not the same thing. With the first, a lender has looked at your credit score and thinks you'll probably be a good risk, but if you wanted to buy a house you'd still have to submit more documents and wait for approval. With the latter, all of your financials have been reviewed and if you decided to buy a house you could place the bid. Real estate agents want to work with people who know exactly what position they're in.


If you're really ready to start the pre-approval process, give Sam Fine a call at 800-923-0031 extension 187. He'll answer any of your questions and help you decide if it's really the right time to move forward with the home buying process!  

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