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Mortgage Loan Pre-Approval: Now More Important Than Ever!

By
Real Estate Broker/Owner with Van West Realty - Greenville, SC Realtor -Short Sale Expert! BIC #69041

In today’s ever-changing mortgage industry climate, it is more important than ever to be sure your buyer clients have been recently pre-approved for their intended home purchase.

Some recent buyer clients had not yet been pre-approved for a home loan, yet I decided to take a gamble, a risk, and a leap of good faith that my new buyer clients were credit-worthy and would not have any problems getting approved for a home loan. We went out three separate times looking at homes priced from the high $400k’s up to $600k. We looked a lot of nice homes, at significant price points, we talked, we built rapport, I performed as a professional, I made sacrifices within my schedule to accommodate their needs, etc. And what did I get for all of this effort? It turns out that their credit scores are so low that it will be a significant challenge just to get them into any home right now, let alone a home at the price points they’re considering. The mortgage broker is telling them he’s working on their situation but they’ll need at least a 20% down payment and they’ll also need to bring in some other family members on the loan who will be living in the house, with some higher credit scores.

What can I say? I took a gamble with my most valuable resource, my time, and it is not looking good at this point for these particular buyers.

How often do you find yourself in this same situation? Are you sticking to your policy of obtaining a pre-approval from a lender before you go out showing homes?

I’d love to hear from my fellow Realtors or mortgage lenders on this topic, especially considering today’s ever-changing mortgage lending industry!

Comments (1)

Patty Carroll
Vancouver, WA

Before we will take them out to look at homes that they do not know if they can qualify for we ask them up front if they are talking with a lender. If they are not and they do not have a lender they want to work with, we provide them with a few that they can talk with to. After they have been pre-qualified and not just pre-approved we take them out to look at homes. You are right with the quickly changing guidlines for a loan they may have qualified a few months ago but not today.

Patty & Scott Carroll - RE/MAX Equity Group Vancouver WA

Mar 29, 2008 04:58 PM