Before you even begin looking for a house to buy, you should contact a mortgage lender to find out what you need to do to get preapproved for a mortgage loan. Getting preapproved is beneficial when buying a house, and here are four good reasons to do this before you start looking at homes for sale.
Agents prefer this
If you know anything about real estate, you are probably aware that real estate agents only get paid when they close deals on homes. If you go through the process of shopping for a home and writing a purchase offer, the agent might be slightly upset if the deal falls through because you cannot get a home loan. Because of this, agents recommend getting preapproved before you shop. It saves both you and them time and money.
You'll know what you can afford
Getting preapproved is also important so that you know what price range to stick with as you shop for a home. The preapproval process your lender uses will determine how much you can afford to pay for a home, and this will be based strictly on your income, expenses, and debts. After finding out how much you can afford to pay, you will know what price range to search within for a house.
Sellers might be more apt to accept your offer
You should also consider how sellers view purchase offers from buyers. When a buyer is preapproved and makes an offer, the seller can be quite certain that the deal will go through. On the other hand, a seller might be leery with accepting an offer from a person who is not preapproved. If the buyer isn't preapproved now, there is a chance that he or she might not even be able to get a loan. If the seller accepts the offer and the deal falls through for this reason, the seller may view all of this as a huge waste of time. This would simply prolong the ability for the seller to close the deal to another party, because the seller would have spent time waiting for you to get approved.
It will speed up the process
Finally, you should realize that getting preapproved now will help speed up the sale when you find the house you want. Your lender would already have all the information needed to turn the preapproval into an actual approval, and this is good for buyers and sellers.
If you have already gone through the preapproval process and are ready to find a home to buy, you should schedule an appointment with a real estate agent to help you search for homes in your area that fit your budget and needs. If you have no credit, you should go to a place like SWE Homes.