12 Feb Pre-Approval Letters are Important for First-Time Homebuyers
A pre-approval letter is a lender-issued document that states the loan amount you can qualify for. While a pre-approval is by no means a commitment to lend, it serves as proof to real estate agents and sellers that you are a serious buyer. This is because at that point of the process the borrower’s credit and income have been verified. Therefore, it’s imperative you obtain a pre-approval letter prior to house hunting, whether it be in person or online. The benefits of a pre-approval are manifold:
- It is an assurance that you are financially able to purchase a home. It also gives you a ballpark estimate of how much home you can buy. This information is incredibly helpful for first-time homebuyers.
- It gives you an edge over buyers without a pre-approval letter. Sellers will know that any offers coming from you should be taken seriously.
- It streamlines the mortgage process as your loan officer won’t need to request some of these documents again. Pay stubs, tax returns, and bank statements often make up the bulk of the paperwork.
As more sellers and listing agents are starting to require a pre-approval letter alongside the offer, your first step in the homebuying journey should be to apply for a pre-approval. Bear in mind, however, that pre-approval letters are typically valid for 60 to 90 days. Make sure to cycle your home search around that time frame. Fairway Fort Lauderdale would love to help take the dream of homeownership off the back-burner and plan your next steps together. Call me today!