The first thing you should do before you begin shopping
for a home is find out how much of a mortgage you qualify for. There are
various tools on the Internet that can calculate this for you, but your best
bet is to get a formal pre-approval from a mortgage specialist. This involves
providing proof of income and a credit check. If there’s a problem with your
credit, now is the time to sort it out.
By getting yourself pre-approved, you’ll know exactly how much you’re able to spend. There’s nothing worse than realizing the homes you’ve been looking at are out of your price range. You may convince yourself that you can afford a home with a double car garage and a family room only to learn later on that this isn’t the case. Readjusting to homes that are less expensive is painful and takes all of the fun out of the home buying process.
Most lenders will lock in the current interest rate for a certain time period so that you’ll be protected should rates increase. If the rates decrease, you’re automatically re-locked at the lower rate. On a $150,000 mortgage, you’ll pay $872 per month at 5%. If rates jump to 6%, then your monthly payment will also jump to $959. That’s a difference of $87 per month or $5,220 over a five year term!
When it’s time to put an offer in on the perfect home, a pre-approval will make your offer more attractive to the seller as you can present a cash offer instead of making it conditional on financing. This can sometimes knock thousands off the purchase price or, in the case of multiple offers, will better ensure that your offer is the one that’s accepted. If you still need to make the offer conditional due to a bank appraisal (as is often the case with lower down payments), you can attach the pre-approval to the offer.
A pre-approval can save you thousands of dollars, hours of time and can even prevent you from losing your dream home. It’s easy, there’s no obligation and, in most cases, it’s free. If you have any questions or if you’d like me to refer you to a mortgage specialist, just let me know.
By getting yourself pre-approved, you’ll know exactly how much you’re able to spend. There’s nothing worse than realizing the homes you’ve been looking at are out of your price range. You may convince yourself that you can afford a home with a double car garage and a family room only to learn later on that this isn’t the case. Readjusting to homes that are less expensive is painful and takes all of the fun out of the home buying process.
Most lenders will lock in the current interest rate for a certain time period so that you’ll be protected should rates increase. If the rates decrease, you’re automatically re-locked at the lower rate. On a $150,000 mortgage, you’ll pay $872 per month at 5%. If rates jump to 6%, then your monthly payment will also jump to $959. That’s a difference of $87 per month or $5,220 over a five year term!
When it’s time to put an offer in on the perfect home, a pre-approval will make your offer more attractive to the seller as you can present a cash offer instead of making it conditional on financing. This can sometimes knock thousands off the purchase price or, in the case of multiple offers, will better ensure that your offer is the one that’s accepted. If you still need to make the offer conditional due to a bank appraisal (as is often the case with lower down payments), you can attach the pre-approval to the offer.
A pre-approval can save you thousands of dollars, hours of time and can even prevent you from losing your dream home. It’s easy, there’s no obligation and, in most cases, it’s free. If you have any questions or if you’d like me to refer you to a mortgage specialist, just let me know.
I pull out all the stops to sell your home.
Lonnie Snyder
REALTOR ®
Keller Williams Realty Southeast Sound
Phone: 206-406-2710
Lonnie Snyder is a full time real estate agent and REALTOR® with Keller Williams Realty specializing in Residential Real Estate for buyers and sellers in Washington's Kent, Renton, Newcastle and South Bellevue.
Lonnie Snyder
REALTOR ®
Keller Williams Realty Southeast Sound
Phone: 206-406-2710
Lonnie Snyder is a full time real estate agent and REALTOR® with Keller Williams Realty specializing in Residential Real Estate for buyers and sellers in Washington's Kent, Renton, Newcastle and South Bellevue.
1 comment:
Being pre-approved means that you are eligible for getting a mortgage, and that you don't have to worry next on getting one if you need to or decided to.Minnesota Real Estate CE
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