Why should you get pre-approval when financing?
If paying cash why provide a bank statement or a proof of funds letter?
The simple answer to both of these is that sellers are more likely to accept your offer when your funding is in writing. The key to a successful house hunt is in the preparation of your documents before you do anything:
In the Sarasota – Bradenton – Venice real estate markets, savvy sellers and their agents typically insist that a pre-approval letter or proof of funds letter accompany the offer. This is typical throughout the U.S., especially now that many markets like those in Sarasota, FL have turned the corner to become a seller's market.
When your offer is accompanied by a pre-approval letter from your lender for financing –or- for cash buyers, with a bank statement / proof of funds letter, it gives you leverage over other buyers that haven’t got their financial documents together. When there are multiple offers on the home you want, your offer with financial proof might be the more attractive offer to the seller; even if other bids are higher. You want to have every advantage.
Please note that when financing, the purchase contract you sign allows a finite period in which to find a mortgage; typically 10 days or less. If you fail to secure financing within that period, the seller may drop your offer. In the meantime, another buyer may bring a higher offer to the seller or even a lower one and bump you out of the picture.
How Long & What does it take to get pre-approval?
The length of the pre-approval process varies, depending on the lender and how long it takes you as the applicant to gather the information needed. Some lenders can complete it in one day. To be properly pre-approved for a mortgage, you will be required to allow the lender to run a credit check and you must supply the loan officer with copies of the following:
1. W-2 forms (usually 2 years worth) or profit & loss statements (for self- employed)
2. Pay stubs (usually 2-4 weeks worth)
3. Bank statements (3 months WORTH): -checking, saving, other assets, such as mutual funds and CDs
4. Tax returns (usually 2 years worth)
Please Note:
Because we want the best for our buyers, we ask our buyers to provide the letter for our file prior to house hunting. Please ask us if you need referrals to qualified lenders. You can contact contact The Sarasota Suncoast Team directly at the http://www.sarasotasuncoasthomes.com/contact/to find out more information on how to connect with us.
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