Pre-approval Letters | Why they are SOOO Important

8 03 2011

It’s fun shopping for houses; to dream of what life will be like in each spot & envision your furniture, your gatherings with friends & family.

Now….visiting with a lender about your finances and bills – not so glamorous. I know…you’re dreading it. Everyone has told you how impossible it is to get a loan right now. You don’t want to ruin the dream and fun by making this call for fear you’ll be told NO.

Even though that prospect is scary, it’s 100% necessary & important. There are many reasons, but I’ll give you a few.

#1 – Most likely you’ll qualify just fine & can you imagine the relief you’ll feel when it’s “done”.

#2 – If you don’t have a bankruptcy in the last two years, you don’t have any judgements (back child support, back taxes, etc.) & you don’t have creditors chasing you to pay your best buy bill, you’re probably good. If you have a job & aren’t behind on any payments for anything else, the likely-hood of you getting a yes is pretty-darn-stellar. I know…not what “everyone’s” been telling you, but I’m right on this one. Promise.

#3 – There is no sense in shopping for homes that aren’t in the right price range. Imagine this….you think you can only afford $100,000 & you’ve looked at those homes. You don’t like the condition, neighborhood, or really anything about them, so you quit looking. BUT….if you went to a lender, they’d tell you you’re approved for up to $130,000. The perfect house for you might be $125,000. Go see a lender. It’ll be worth it.

#4 – On the flip side of #3….imagine you’ve been looking at homes for $175,000-$200,000. You’ve found five or six you like, but someone else keeps getting to them just a bit faster than you. đŸ˜¦ You’ve finally after months gone to an open house of the PERFECT place. OMG…you can’t wait to put in an offer. You hurry off to call a lender & you find out you’re only qualified for $150,000. WHAT!?!? That’s impossible! I know I can afford $200,000! I’ve run the financial calculators online & I KNOW I CAN AFFORD IT! (Stop laughing….or rolling your eyes….this happens to people A LOT & you might one of them if you won’t call a lender) It’s devastating to get that news. That’s why you should ALWAYS call your lender first. It will stop a lot of heartache and hours that you’ll spend pouring over all the online listings.

#5 – Probably the most important, no one will accept an offer from you without a pre-approval letter in tow. It’s a necessary step to get the dream home you want. No if’s, and’s or but’s.

Really, why wouldn’t you call to find out what you can afford before you go shopping? It’d be like going to the mall with a gift card that had “something” on it, but you’re not sure what…..so there you are in your favoriate store, not sure if you can afford a pair of gloves, or brand new riding lawn mower. Silliness.

Lenders don’t bite. They won’t laugh at your credit score. They are helpful. I promise. And if the one you call isn’t, let me know & I’ll help you find one that is. I have worked with LOTS in my career & finding the perfect lender is like looking for a needle in a haystack, but they are out there.

Know what’s even better? Once a lender checks your credit (which they don’t HAVE to do in order to give you a good idea of what the target range will be), you’ll have 30 days to shop around and have other lenders check your credit as much as you want….but only for 30 days. That’s the industry’s way of saying, “Please….do shop for a mortgage to get the best deal for you & your family”

That’s all. (Can you tell not many people take this important step first and it usually doesn’t end well & I have a soap box I’m climbing off of now?)

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