3 Reasons Why Your Realtor Will Ask if You’re Pre-Approved Before You Start House Hunting (and if they don’t…BEWARE)!
The beginning of 2018 has been great! I got my Christmas tree put away, tucked away the karaoke machine (yes…my family loves karaoke), and set my goals.
I’m recharged and ready to have the best year ever!
I love speaking to potential clients about buying and selling property.
A few weeks ago, I spoke to a lady, who called about a lot of land that I have listed for sale. She found my land listing on line and was excited about the land.
After looking at more than 20 properties and working with multiple Realtors, she was so excited about this one that she took her husband to see the lot, hired an architect to draw up plans, and even started purchasing travertine for the floors for her “new home.”
She was ready to make an offer…so she thought!
Although she had worked with many real estate agents, none of them took her through the pre-approval process…Big mistake!
One of the very first questions I ask potential clients is about financing. I want to know if they’ve been pre-approved.
As I began asking her questions, I realized that she hadn’t spoken to a lender. Although she was sure she and her husband could obtain conventional financing, she didn’t understand that financing is very different when it comes to purchasing land.
If you’re serious about purchasing real estate, you absolutely must get pre-approved!
Here are 3 reasons why your Realtor will ask for a pre-approval letter BEFORE you start looking for your new home…
1. Provides Proof of Ability to Obtain Financing
The reality is, not everyone will get pre-approved to purchase a new home. You should speak to a lender to make sure you can obtain financing. The pre-approval application doesn’t take long and a great lender will get you a pre-approval letter within a few days.
Although a pre-approval letter doesn’t guarantee financing, it does show sellers that you already have backing and that you have the ability to go through with a sale should you enter into contract. A pre-approval letter also proves to both your Realtor and sellers that you are a serious buyer.
2. Saves Time & Frustration
Have you ever been shopping and fallen in head over heels in love with the perfect pair of shoes (or M6 or whatever it is that you’re shopping for) only to find out it’s WAY out of your price range?
Well…this can happen when you’re house hunting too!
The last thing you want to do is fall in love with a home that you can’t afford.
A pre-approval letter not only shows that you can obtain financing, it will also give you information as to what price range you should stay within when shopping for a new home.
3. Strengthens Negotiation Ability
Depending on local real estate market conditions, a pre-approval letter will strengthen your ability to negotiate. If a seller receives multiple offers on their home, which is pretty common, they’re going to select a purchase offer from the buyer who provides a letter of pre-approval.
A pre-approval letter is critical if you want to win in a multiple offer situation.
If you’re serious about purchasing real estate and want to save time and energy, I strongly encourage you to speak to a lender and get prequalified.
If you’re in the market to purchase real estate, contact me! I work with a few great lenders and I’ll connect you to the best lender to fit your needs.