New Door Adventures

Your Guide to Smarter Home Buying and Selling – Expert Advice, Cost-Saving Tips, to Navigate the Journey with Confidence!

Getting Pre-Approved

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It is important to get a pre approval in place with your lender before you even start looking at houses.

You might ask WHY?

It’s simple… before you go shopping, you should know how much you can afford to spend.

Scenario: You are going out to look at houses, you’ve made an appointment with a Realtor. You also looked on MLS for weeks and short listed the houses you loved on screen and want to take a closer look at. You spend 2 days with your friendly neighbourhood real estate professional and you fall in love with one of the houses. That’s the one!! You hurry to set up another appointment with your Realtor and you write up an offer. The offer is then submitted to the seller, you spend 3 days negotiating on price and all the terms, to finally get your offer accepted. Then, your Realtor forwards this offer to your bank, you submit all the paperwork required. After what seems an interminable amount of time, you nreceive a phone call from your lending specialist to announce that you got DECLINED on financing!! That would be devastating, to say the least.

Solution: If only you had been to your lender at the very beginning of the process to get pre-approved to find out actually how much you could afford.

The pre-approval is an in-depth look at your credit score as well as your current bills and financial obligations (loans, payments, student loans, credit card balances, etc). Basically, it looks into how well you have been managing your money. This easy, upfront process also lets you know what the interest rate at this time would be and what to expect as far as mortgage payments. Are these not things you feel you should know BEFORE you go out looking!!??

Underwritten Pre-Approvals will review your income, your credit and your down payment source. These are the 3 pillars of a mortgage approval. An underwritten pre-approval will also tell you a maximum qualifying amount (how much house you can afford). This is a more lengthy process but it will set you up to be well on your way once you actually choose the house you wish to purchase.