The True Value of an Accurate Pre-Approval
Jim Hawkins
Close on Time. EVERY Time. | Residential Mortgage Loan Originator | NMLS# 1252841 | MI, UT, AZ, NV, CA, WA, TX, OR.
As the weather warms and the days get slightly longer, all of us in the real estate business begin preparing for the rush of the home-buying season. And even though there are lots of fun and exciting parts of buying a new home, there’s one thing I see way too often that can derail the entire experience - an inaccurate pre-qualification.?
Whether you’re a first-time home buyer or have purchased several homes in your lifetime, the very first step in the process is getting pre-qualified, before contacting a Realtor.
As a licensed mortgage loan officer, too often I hear horror stories from clients who come to me after having their entire world flipped upside down because of a bad pre-qualification.?
See, the pre-qualification shows the seller that you’ve consulted with a licensed mortgage loan officer, your credit has been reviewed, and you have verbally provided your income and asset information.?
A good pre-qualification tells you:
When you’re ready to tour potential homes, your realtor will ask to see your letter and to keep it handy so when/if you make an offer it can be provided to the seller.?
If you’ve got an accurate pre-qualification, congratulations are in order. It’s time for the fun part – home shopping!
Pre-Qualification vs. Pre-Approval
To take it one step further you can get pre-approved. The difference between a pre-approval and a pre-qualification is simply you have provided verification of your income and assets and it has been approved by the actual underwriter.?
Typically, the verification process requires -?
If you are self-employed you typically need two years of tax returns.
Once your income and assets have been reviewed and approved, your pre-qualification will be updated to a pre-approval.
Why This Matters
This lets potential sellers know you’ve got a green light and chances of any delays, or even worse, a last-minute denial is slim…
When I say ‘last-minute denial’, that’s exactly what I mean when clients come to me with horror stories. I can’t emphasize enough the importance of using an experienced mortgage professional when you start the home-buying process.?
By doing your due diligence on the front end, chances of any delays or the dreaded last-minute denial are extremely rare. That's why it’s so important to take an additional step by researching your potential mortgage professional on the National Mortgage Licensing System or NMLS Consumer access website .?
Simply type in their license number and you’ll be advised of any complaints or regulatory issues associated with your potential loan officer.?
If you have any questions or want to get the process started, I am one call or email away - days, nights, and weekends, I’m here.?
Additionally, if you don’t have a realtor in mind, I have a large network of real estate professionals to reach out to.?
Call, text, e-mail, or DM anytime.
Happy House Hunting!