The majority of lenders highly suggest getting pre-approved for a mortgage before shopping for a home to purchase. In fact, you will most likely be unable to submit a purchase offer without showing a current loan status report (LSR) or proof of funds for an all-cash purchase. There are many reasons why loan pre-qualification this is a very good idea:
- Loan pre-approval will let you figure out which mortgage is right for your needs as well as which you qualify for
- The lender will give you a pre-qualified purchase amount so you know ahead of time what your budget is
- A monthly mortgage payment amount will be set
- Closing cost estimates and down payment amounts will be determined
- First time buyers will learn up front what kind of incentives they qualify for, typically obtaining more house for the money
- For those with special situations, co-mortgage financing options might be available
- Getting pre-approved saves a lot of time so once you select a home you can begin the offer process right away
- Having a pre-approval loan letter will improve your negotiations with the seller
It doesn’t take long to get pre-approved and most mortgage lenders will help you right over the phone. It’s worth the call and could save you thousands!
