BUYERS January 23, 2023

Pre-Approval in 2023: What You Need To Know

Are you thinking about buying a home? One of the first steps in your journey should be getting pre-approved. But what is pre-approval and why is it so important?

Pre-approval is the process where a lender looks at your finances to determine what they would be willing to loan you for a mortgage. The lender will then give you a pre-approval letter, which will outline how much money you can borrow and what your rate could be. This information is crucial for understanding your options and what you can afford when searching for a home.

The first step to getting pre-approved for a mortgage is to gather all of your financial information and documents. This typically includes:
-Proof of income, such as pay stubs and tax returns.
-Proof of assets, such as bank statements and investment account statements.
-Identification, such as a driver’s license or passport.
-Credit score and credit report
Once you have all of your financial information and documents together, you can then start the process of finding a lender and applying for pre-approval. This can be done by contacting a bank, credit union, or mortgage broker, or by using an online lender.
After the lender has reviewed your financial information and approved you for a pre-approval, you will receive a pre-approval letter that you can use to show to sellers that you are a serious and financially qualified buyer.

Not only does pre-approval give you a better understanding of your numbers, it also helps show sellers that you’re a serious buyer. A pre-approval letter from a reputable lender can make the difference between a seller accepting or rejecting your offer. In today’s market, where higher mortgage rates are impacting affordability for many buyers, pre-approval is more important than ever.

So, if you’re thinking about buying a home, be sure to connect with one of our local real estate professionals and a trusted lender to get pre-approved. It’s the first step towards making a strong offer and closing the deal on your dream home.