When you are ready to buy your dream home and put an end to paying monthly rent, it makes total sense to bargain from the strongest possible position. In a strong and competitive real estate market, a seller has all the right to be selective when it comes to the final buyer they opt to negotiate the purchase and sell of property with. As mentioned, the real estate market is such a competitive one thus it is not entirely uncommon for a property seller to get multiple offers on a single property. As such, there are important things that you can do as a buyer to ensure your offer stands out from the rest and you emerge the final buyer.
With an almost collapse of the credit industry and housing and banking meltdown, today it is very tough to get a pre-approved mortgage. Note the difference between pre-approved and pre-qualified, all important aspects of buying a home or property. Mortgage pre-qualification simply means that a potential buyer has completed all necessary steps to satisfy the criteria set by the Federal Housing Authority and doesn’t have anything to being approved by the mortgage lender.
Mortgage pre-approval on the other hands is when the buyer acquires the pre-qualified status after the mortgage lender has verified their details and their credit. Once all these steps are completed, the buyer is then said to be mortgage approved. As is evidence therefore, getting pre-qualified is an important step to getting pre-approved.
Upon meeting the set pre-qualifying criteria for a mortgage, such as proof of employment, income, good credit report etc, your next step would be to fill the mortgage pre-approval application form, which ought to be accompanied by evidence of satisfying all pre-qualification requirements. Your mortgage lender will then review all documents and make a final decision as to whether you qualify for pre-approval or not and if yes, for how much. At this juncture, you might be called for a personal interview to help clear up anything that is unclear in the paperwork. If all else however is in order, you will without a shadow of a doubt get pre-approved which means you can start shopping for a home with some extra purchasing power.
Be advised that if you are facing foreclosure proceedings, you will be expected to wait for at least 3 years for you to be able to get pre-approved, with the 3 years starting at the end of the foreclosure process. Most property sellers in the real estate market are willing to extend unbeatable deals to property buyers who come with pre-approved mortgages. This is partly because they avoid going through all buying and selling proceedings only to experience the dreaded dead fall through because the buyer cannot be approved. As such, if you want to make your work easier, it is highly recommended to start your house hunting mission with a mortgage pre-approved.