|
IS A MORTGAGE PRE-APPROVAL IMPORTANT? Yes. It's important to know how much you can afford to spend on your home or condo purchase. One of the most crucial preliminary steps that every buyer should take, is to sit down with a qualified mortgage specialist who can pre-approve a mortgage amount and lock in a preferred interest rate for you. Most importantly, they can fully explain all that you need to know. There are numerous advantages to having a pre-approval, and, so many disadvantages in not having this pre-approval in place. Read on for more information. KNOW HOW MUCH YOU CAN REALLY AFFORD! This is one of the obvious reasons to sit down with a mortgage specialist and get pre-approved. You will know exactly how much you can afford to spend on a home or condo purchase. You will also find out what the outcome would be should the property taxes be higher or lower than expected. Knowing this allows you to shop in the right price range. YOUR INTEREST RATES WILL BE LOCKED IN! When you become pre-approved for a mortgage you will be given a discounted rate (dependant on your qualifications and credit score) and this rate will be locked in for a period of 90-120 days. We often see during the winter months pre-approvals with rates gaurenteed until July 1st-15th! Should the rates go up prior to you notarizing your purchase, you will be offered the gaurenteed rate that was offered a the time of your pre-approval! Should the rates decrease prior to notarizing your purchase, you will get the new lower rate. It is a "win-win" scenario! BARGAINING POWER: MAKE THE SELLER CONFIDENT IN YOUR ABILITY TO SECURE FINANCING!
So often agents hear the words, "don't worry, I can get a mortgage". In most cases, this may in fact be true. However, one of the greatest concerns a seller will have in accepting a buyer's offer is whether or not they have the ability to arrange financing in a timely manner. The seller does not know you; they want to be assured that all will go smoothly. If you do not have a letter from a lender proving that you can arrange a mortgage in a timely manner, the seller may decide to bypass your offer and to accept one from another buyer. This is especially true if more than 1 buyer makes an offer at the same time ("multiple offers"). FACT: You will always have more bargaining power if the seller is not worried about your financing! YOU ARE TAKEN MORE SERIOUSLY BY ALL! The truth is that since proving your financial capability is such an important step in the home and condo buying process, you will be taken that much more seriously by all parties involved in a real estate transaction if you are pre-approved for a mortgage. Why raise any unecessary red flags! THERE IS NO COST OR OBLIGATION TO YOU! The truth is that there is no cost whatsover in getting pre-approved for a mortgage and you still will have no obligation to even go ahead and make a purchase! You have nothing to lose! So if you arfe seriously considering a purchase, get yourself pre-approved. YOU CAN STILL CHANGE YOUR MIND ON WHICH LENDER YOU WILL USE! Where as in most cases you will find that there is absolutely no reason to change lenders before notarizing, it is important to know that you still have the right to make a change up to 2 weeks prior to notarizing your purchase, just in case the need arises! SO MANY ADVANTAGES....NO DISADVANTAGES! As you can see, there are so many reasons why you should get a mortgage pre-approval and there are absolutely NO disadvantages what so ever in having the pre-approval in place!
|