Buyers: Why Get Pre-Approved?
I know you have read about this a gazillion times, but there is a reason why agents relentlessly write about it. And in today's market it is more important than ever.
This weekend I am showing property from a call about a property for sale. I asked them to please talk to their bank and make sure they were qualified prior to showing it. I made the appointment and this afternoon called to follow up and verify that they would indeed still be interested. Yes they said, we will be there. And then I asked, "Did you talk to your bank?" Oh, no. If we are going to make an offer, we will. Arghhh!!
There are many reasons why I now ask for people to be pre-qualified prior to showing them homes.
#1- The number one reason I want that letter is that I need to know whether they can afford to buy the home I show them. I like to have some respect for the sellers of that home, I want them to know I am only showing their home to people that can actually buy it and are serious. I don't want to waste their time or mine so that people can satisfy their need to just look.
#2- There is nothing worse than allowing someone to fall in love with a home, only to find them crushed when they cannot afford it. Or find there is an issue on their credit they didn't know about, and they need to step back and clean it up and then start the looking again later. And that is really hard for me as well as them. I want buyers to have a good experience when going through the home buying process, and this will only rip their heart out, and leave a bad taste in their mouths.
#3- With the housing market so tight right now you simply cannot get an offer accepted without the documentation to prove you can actually buy it. No seller wants to stigmatize their home after a contract falls through, for any reason. Once it comes back on the market, there is always second guessing as to whether the home had some major defect. I for one, certainly do not want to contribute added stress to a sellers who is already on the edge over the selling process. Not to mention causing a loss of money from a lower sale price.
If both sides play nice throughout the process from start to finish, it will make everybody much happier, and that is the end goal for me. Win-Win Or No Deal is still my motto.
So when your buyers agent asks you to get a loan approval letter, please respect their commitment to doing the right thing and go to your favorite bank and get one. You will be glad in the end and it will make the process go much quicker and smoother.