Why Should I get a pre-approval? I haven't found a house yet! I get this question a few times a week from both first time buyers and seasoned buyers and there are TONS of reasons that have nothing to do with your agent's paycheck.
So, here are few of the important reasons:
- So you know what your payment will be. A good loan officer will be able to give you a good idea of your payment including your taxes and home insurance. Most online calculators only give you principle and interest based on little to no info.
- What type of loan can you get? There are a lot of loans out there but not all homes qualify for all loans. Pre-approved for USDA (Rural Housing)-homes inside city limits won't qualify typically. FHA or VA? Most bank-owned (foreclosures) homes won't qualify.
- What inspections will be required? This depends on the loan AND the home. I can let you know which inspections are required and which are recommended.
- How much of a down payment will you need? Can a relative give you the down payment? It all depends on the loan.
- You may qualify for more than you thought which may open up other neighborhoods and areas where you're searching.
- You may need to pay down some bills so you can afford a home in the neighborhood you want.
There are a lot of variables with each type of loan. Going house hunting without knowing what your loan options are, is like making a cross crountry trip without a map. You'll get there eventually but it will be a long, stressful, tedious journey. Get a map by getting a pre-approval.
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