One of the most commonly asked questions a lot of my clients ask me is whether they should get a pre-approval before they go house hunting. My answer is almost always YES! To find out why, read our 7 reasons why you need a loan pre-approval.
1. Know Your Budget
It helps you figure out exactly how much you can afford to spend on a home, making your search more focused.
2. Stronger Negotiating Position
Sellers take you more seriously when you have pre-approval, giving you an advantage in negotiations.
3. Save Time
Knowing your budget upfront saves time by narrowing down your search to realistic options.
4. Confident Offers
With pre-approval, you can confidently make an offer. A shorter finance clause can make your offer more appealing to sellers.
5. Quick settlements
The pre-approval process speeds up the time it takes to close the deal, which is useful in competitive markets.
6. Avoid Disappointment
It prevents falling in love with a home only to later find out you can’t afford it.
7. Credit Check
The process includes a credit check, helping you identify and address any credit issues early on.
Remember, a pre-approval typically lasts for 90 days. Start the process when you’re actively looking to avoid unnecessary credit checks. If it expires, you can usually update it with current documents, but after 180 days, a fresh application is often needed.
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