Why Do I Need A Pre-Approval?

What is a pre-approval and why do I need one?

Generally, it is recommended that you get pre-approved for a mortgage loan before you start viewing properties for sale. This involves meeting with a lender who will examine your current financial situation and credit history. The lender will then provide you with a document stating how much you can borrow to buy a home, which is called a pre-approval letter. The benefits of a pre-approval:

  • You’ll know with certainty what you can afford and not waste your time looking at homes that are outside your price range.
  • You'll know what your monthly mortgage payments will be and can budget accordingly.
  • As a qualified, motivated buyer you’ll be taken more seriously when you make an offer on a home.
  • You can lock in a good rate now, before rates go up again.
  • A lender can determine whether you qualify for any special programs that may enable you to afford a better home (particularly if you’re a first-time buyer).