Saturday, March 14, 2015

Why do I need a mortgage pre-approval before looking at homes?

The majority of home buyers I work with in Brevard County, Florida are not cash buyers.   Still, whether one is paying cash or obtaining a mortgage it is critical to determine ones ability to purchase before looking at homes.  

Sellers want to have confidence that people walking through their homes are real potential buyers.  Sellers want to know a buyer has the ability to purchase a home before they accept an offer.

Real estate agents want to know prospective buyers have the ability to purchase a home in the price range they will be looking before heading out to see properties.

But more importantly serious home buyers should want to know as well - first.

How does one prove they have the ability to purchase a home?  

For cash buyers it can be as simple as a letter from a bank or investment firm indicating the funds are available.  If a buyer has the ability to pay cash then the challenge is primarily in deciding the budget.

For non-cash buyers the proof is a mortgage pre-approval letter.   To start a home search the mortgage pre-qualification can initially serve as a good starting point for a buyer who is starting an initial search.  (Maybe for the first day of looking.)  But after the initial search commences the preferred prof is the mortgage pre-approval.

What is the difference between a mortgage pre-qualification and  mortgage pre-approval?

When is the highest offer not the best offer?

Considering buying a Melbourne, Florida home?  Call me at 321-693-3850 or send me an email if you have questions.  I can help and would welcome the opportunity!