The Importance of Getting Pre-Approved
When you want to buy a home, one of the first things you need to do is get pre- approved. But why is this step so important? To find out, let's understand what pre-approval is and how it helps you.
How Does It Work? As part of the pre-approval process, a lender looks at your finances to decide what they’d be willing to loan you. From there, your lender will give you a pre-approval letter to help you understand how much money you can borrow. That can make it easier when you set out to search for homes because you’ll know your overall numbers. And with higher mortgage rates impacting affordability for many buyers today, a solid understanding of your numbers is even more important.
What Is Pre-Approval? Experian explains it like this: “A mortgage preapproval is a document from a lender indicating you are conditionally approved for a mortgage loan—up to a specific amount—to buy a house. It usually specifies the type of loan you qualify for and the interest rate the lender would charge you upon completion of a full mortgage application.” Basically, pre-approval gives you critical information about the homebuying process that’ll help you understand how much you may be able to borrow so you have a stronger grasp of your options.
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