The Advantages of Home Loan Preapproval

Real estate experts are saying to their customers that it is crucial to apply for the home loan prequalify before shopping for a home. We have to admit that their advice is really a great one since, on a closer look, we can see that the customer will have a lot of advantages if he will respect this steps' sequence. But did you know that it is far better to be preapproved for a home loan than to be prequalified? This way you will gain even more benefits than you would guess.

A preapproval letter is given by the lender and it is containing some information like the borrower's credit or bank references, giving to the lender other conditions like an appraisal of the property. Following this procedure you will obtain advantages like:

• Enjoy a Faster Closing Period:

Mortgage approval has, usually, the longest period of time in purchasing a contract. Home loan prequalify also lasts a lot. But, a preapproval for a home loan can be closed in a maximum of 30 days, because it will not need a window period to process your application. You can make it even faster if you will accomplish the seller's need to close it quickly.

• Gain More Confidence:

With a home loan prequalify you can be faster disappointed. Imagine that you found your dream house, but someone is telling you that you can't buy it because you don't qualify for it. This situation can be avoided by applying for a home loan preapproval.

• Have More Time To Search For The Right Home:

By diminishing the inventory of homes only to those that are fitting to your parameters, you will have much more time to think about all the fiddling niceties each home has for offering. Both, home loan preapproval and home loan prequalify are giving you this time.

• Increase the Negotiation Power:

When you have already a home loan prequalify, your negotiation power is a lot bigger than when you don't. The seller will have in mind that the house is already sold and that it is only a matter of time until when this thing will really happen.

Prepare from time your home loan preapproval letter and also the home loan prequalify letter, so that the lender to be able to render faster a decision founded on your employment verification, complete loan application and data from all three credit reports. While he is doing this you can search for your dream house or any other problems that you have, without thinking that you will be qualified or not.

Related Post: