October 5, 2020
4 Reasons to Get Pre-qualified for a Mortgage Loan
One of the most common goals for people is being able to afford and purchase their very own home. Understandably, the process of buying a home can be quite intimidating, and thus people will not choose the best route. Although going through the process is time-consuming and often difficult, it doesn’t mean that you can’t do certain things to make the process easier. One of the best steps you can take is to pre-qualify for your mortgage loan. Why is this so important, however? Here are four reasons why you must prequalify for your home loan before starting your search.
1. Creates a More Solid Financial Situation
The absolute worst thing that you can put yourself through during the buying process is stressing out about the state of your financial position. This can lead you to either purchase too much of a home or too little. Pre-qualifying for your mortgage provides you with the knowledge that you are getting a home that is within your purchasing power. Besides, removing this stress can open your eyes to making sure that you are purchasing a home within a good area.
2. Gives You a Leg-Up on Negotiations
When a home sale takes place, sellers are looking to make as much money as they can, and buyers are trying to pay as little as possible. When you aren’t pre-qualified for a mortgage loan, you are essentially giving the seller all the power. Sellers can make it seem like they are doing you a favor when, in reality, they are simply looking for the best deal. Having a pre-approved mortgage loan allows you to have walking-out power. This means that sellers can see that you have readily available funds and are not afraid to walk away if the deal isn’t right.
3. Priority Buyer
The fact is that buyers want to close on a home as fast as possible; therefore, when you enter the picture with a pre-approved mortgage loan, you are not only showing them that you have the funds but that you are serious about the deal. This leads sellers to place you on top of their priority list, which, as you may know, is very important when bidding on the home of your dreams.
4. Faster Closing Time
A common part of the home buying process that many don’t speak about is the length of closing a deal. Closing a home deal can take over 50 days to complete, and that’s due to a number of reasons. One of those reasons is the approval of a mortgage loan. Real estate agents attempt to protect their clients by making sure that the loan is approved before proceeding with any signed documents. When you have a pre-approved mortgage loan at the ready, you are much more likely to shorten the length of that closing time.