Why you should get a Mortgage Pre-Approval
So you are ready to buy your first home, now what? Your first step should definitely be to obtain a mortgage pre-approval, but don’t get that confused with a “Pre-Qualification”.
A mortgage pre-qualification is a quick calculation based on your debts and assets, and occasionally your credit score, to estimate how much mortgage you could afford, but is never reviewed by an actual lender.
A mortgage pre-approval on the other hand, is when a lender reviews your full application (credit, debts, assets, source of down payment, proof of income, and more) and assess you for suitability. Once they have reviewed the file, they will reply with an offer, this is not a formal approval, but is as close you can get without having a purchase agreement!
So how do you go about getting a pre-approval?
Your first step is to call a trusted Mortgage Agent.
The mortgage agent will discuss the different types of products, lenders, as well as the pros and cons of all your various options! Once you have an idea of what you want, your mortgage agent will help you to complete an application and a few other documents, you will also be required to bring some documents with you to show income, down payment, etc.
Once everything is ready, the mortgage agent will tell you approximately what you could be approved for, and will send your file off to the right lender to get a formal pre-approval. Once the lender responds to the pre-approval request (24-48hrs) your offer lasts for 60 to 120 days (means your interest rate is locked in for that time) depending on the lender.
So what does the pre-approval mean to you?
It provides you peace of mind. Allows you to shop for your dream home knowing the price range you can afford, and could get formally approved for. Most realtors won’t even take a prospective buyer out to see homes without first having a pre-approval! So it is definitely worth taking a brief pause in your window shopping to get that pre-approval secured!
To get started, contact me any time, I’m here to help!