|
It used to be that buyers could go
house shopping and when they have found their dream home, then they go to
get pre-approved. However, in today's market, that has proven to be one of
the least effective methods in landing the dream home.
Most
mortgage Brokers can pre-qualify you for a mortgage over the phone. Based
on general questions about your income, debt, assets, and credit history,
lenders can estimate how much mortgage you qualify for. However, being
pre-qualified and pre-approved are different things. Pre-approval means
that you have applied for a mortgage; you have filled out the mortgage
application, received your credit report, and verified your employment,
assets, etc. When you are pre-approved, you know exactly what the maximum
loan amount will be.
A pre-qualified letter is not verified and in
essence, does not count for much if you are competing with other buyers
who are pre-approved. When you are pre-approved, you and the seller know
exactly how much house you can afford. It gives you credibility as an
interested buyer and lets the seller know immediately that you will
qualify for a loan to buy their property.
In addition to being
pre-approved, it's important to be pre-approved with a legitimate lender.
Legitimate lenders include: banks, mortgage bankers, credit unions,
savings and loan associations, mortgage brokers, and online lenders.
Some lenders to avoid: those who lose a form or misplace a file,
those who gather information from you in an unorganized manner, those who
are not informed about interest rates, points or costs, and those who
cannot provide you with the right information. |
