We’re all searching for a little certainty nowadays. At a time when it seems like everything is changing, you can at least buy yourself a little peace of mind in the homebuying process by getting pre-approved.
Now, we know what you’re thinking: I have a steady job, savings for a down payment and relatively predictable monthly expenses. Do I still need a mortgage pre-approval? The answer is yes. Everyone can benefit from pre-approval.
Gain Financial Clarity
One of the biggest advantages to getting pre-approved is the clarity you gain on just how healthy your finances are. Think about it. When’s the last time you checked your credit report? Analyzed your debt-to-income ratio (DTI)? Consolidated your debt or reviewed your investments? How often do you make large purchases without thinking twice about them?
The answers to all these questions and more will be taken into account in the pre-approval process. No matter where you fall in terms of credit score, down payment or DTI, pre-approval will help you gain an accurate look at where you stand now – and where you may need to get to qualify for the home of your dreams.
Even if you’re not quite there yet, APM’s loan advisors can walk you through the pre-approval process, outlining the exact steps you can take to reach your goal faster than you ever thought possible. You can’t achieve a goal if you don’t have a starting point. Pre-approval is that starting point that will lead you to the finish line.
Browse with Purpose
We all love to browse the real estate listings, scrolling through photos of multi-million-dollar houses and scoffing at their gaudy wallpaper. It’s a great pastime, even if we know those homes are out of our reach.
Unfortunately, without pre-approval, many Americans will “guesstimate” what they can spend on a new home. This number can often be over budget, especially if you take HOA fees, property taxes, closing costs and more, under consideration. On the flip side, others under-estimate their buying power. This leads them to assume that gated communities, homes in the best school districts and dwellings that feature every amenity under the sun are for other people; not buyers like them.
Don’t let assumptions run away with your housing dreams. Taking the time to undergo pre-approval will save you tons of time, energy and stress when you begin your homebuying process. And, yes, that includes when you’re “just browsing.”
Bid with Confidence
Low interest rates and a lack of inventory mean you may face some competition when you finally find the perfect house. There’s a big difference, however, between “wanting” to buy a home and putting in an offer that shows the seller you’re fully funded and prepared to buy this home – at this price – TODAY. For a seller, that’s like cash in hand! An offer from a pre-approved buyer will almost always carry more weight than a similar offer from an interested party who isn’t pre-approved.
A pre-approval tells the seller you mean business. Unless you’re an all-cash buyer, this kind of confidence is hard to establish any other way in the homebuying process. Plus, if a seller counters your offer, you’ll know exactly how high you’re able to go. That doesn’t mean you have to offer the maximum amount you’re pre-approved for, but you can bid and negotiate with certainty, knowing you have some wiggle room to play with.
Nothing is ever certain. It’s a sentiment that we, unfortunately, have become all too familiar with in 2020. So find stability when you can. This pandemic doesn’t have to derail your financial goals or homeownership aspirations. Start the pre-approval process today, then browse and bid with confidence knowing you’re in one of the lowest interest rate environments this country has ever seen!