Pre-approval is Critical

If you are planning to buy a home this year, one of the first steps on your journey is getting pre-approved. In today's market when mortgage rates are higher than they were just a few months ago, getting a mortgage pre-approval can be a game changer.

What is Pre-Approval? A mortgage pre-approval is when a lender determines you are qualified for a home loan. Your pre-approval letter shows the maximum loan amount you are approved for as well as the specific interest rate and loan term you can expect.

As part of the pre-approval process, a lender will look at your finances to determine what they would be willing to loan you. Your lender will then give you a pre-approval letter to help you understand your true price range and how much money you can borrow. And with mortgage rates rising and impacting affordability, a solid understanding of your numbers is even more important.

Pre-Approval Can Signal You're a Serious Buyer. Another benefit is that pre-approval lets the seller know you are qualified to buy their house. Getting pre-approved can actually improve your chances of falling into the sellers' good graces. You'll want to get it done as early as possibly can in the home buying process.

Even though bidding wars are easing this year as the market shifts, pre-approval is still an important part of making a strong offer. It can help a seller feel more confident because it shows you are serious about their home and that you are a qualified buyer.