Why should you get pre-approved for a loan?
I usually ask every buyer some of the same basic questions, one of which is have you talked to a lender? Recently, I have gotten the same response from different people "my credit score is good so I don't need to talk to a lender first." WRONG- Credit score is only a part of the loan process, I know lots of people with great credit who can't buy a home or at least a home in the price range they want. Why is that? A little pesky thing called debt to income. Banks always look into how much you make per month vs how much you are paying in bills, if you are paying too much they will not approve the loan. Why do you ask? Well, the bank wants you to pay them back.. I know that sounds crazy.. but when you loan money don't you want to be paid back? You see, that really nice car you bought three years ago and the balance on your credit cards have a negative impact on your debt to income ratio and could prevent you from buying your dream home.
Also here is another great reason, we are in a seller's market where multiple buyers are making offers. If you are not pre-approved then the seller will not give your offer the consideration it deserves. Imagine watching your dream house sell to someone else because you didn't get pre-approved. Sadly this happens! Shopping for homes without a pre-approval is like going to the store without any way to pay.
Want to help yourself? Ask us about how to get a full loan approval (pending home appraisal) ahead of time so when you find the perfect home, the sellers are more likely to select your offer.