Why do you need to get pre-approved for a home loan before you go looking at houses? The best reason for buyers to get pre-approved before looking at homes is that it just makes sense for buyers to know what they can afford before they get into proper buying mode. Most buyers are a little nervous about the huge step they’re taking in their decision to buy a house and getting pre-approved builds confidence and gives peace of mind in the home buying process. It will also directly impact the time buyers spend looking at homes, because they won’t waste time looking at houses they can’t afford, making the entire process much smoother and easier. Last, but definitely not least, a pre-approval letter is a great way to make a good first impression with the sellers when it comes time to write an offer on a house.
Buyers Spend Time Looking at the Right Homes
It’s completely frustrating and depressing for buyers to spend time looking at homes in a certain price range to later find out that they can only get pre-approved for a lesser amount. It’s hard to look at lower priced homes after you’ve been looking at nicer, more expensive homes. Buying a house or condo is a process of elimination. If buyers eliminate the houses out of their price range right from the start, it will save time in the long run and make for a less stressful buying experience. Buyers often think when they start the home buying process that they need to look at dozens of homes to “get an idea” about the market. Many years of experience working with buyers has shown me that this simply isn’t true. Looking at endless numbers of homes that don’t fit the bill is nothing but frustrating for the average buyer. At some point they get “house overload” and the home buying process becomes a chore rather than the happy experience they had in mind. It makes much more sense to save yourself time and energy by eliminating houses that are out of your price range right from the start.
Excellent Credit? Getting Pre-Approved is Still a Good Idea
Even buyers with excellent credit who know for a fact that they’ll have no problem qualifying for a mortgage should go through the pre-approval process before looking at homes.Shopping for a home is no different to any other purchase. Most buyers have a number in their head that they feel comfortable paying every month. Does that number align with what the lender has to offer? Since both interest rate and closing costs will impact that, there’s really only one way to find out and that’s to talk to a lender. Online calculators help, but they don’t factor in everything and if they are off by a couple of hundred dollars, that will make a huge difference to a monthly payment.
A Pre-Approval Letter to Impress Sellers
A pre-approval letter WILL help when it comes to writing an offer. Especially in the spring market in the Iowa City area, when it’s not unusual for buyers to find themselves in a multiple offer situation. It’s a sellers market in the Iowa City area and buyers need to put their best foot forward when they write an offer on a home. Preparation is everything when you’re in the market to buy a home and being prepared with a pre-approval letter in hand and ready to go is the first step to showing the sellers that you’re serious about buying their house!