Preparing to buy a home can bring feelings of excitement and maybe even some uncertainty. Because you are not the only interested buyer, you may want to do things to improve your appeal to sellers.
Pre-approval for a home mortgage loan is one strategy you may use to get the upper hand. Understanding how pre-approval works can help you determine whether or not it could work for you.
Leveraging your pre-approval
Just because you want pre-approval does not mean you will get it. You must meet specific criteria to qualify. According to Zillow.com, the process of determining your eligibility often requires a preliminary review. A qualified lender will assess your loan qualifications after reviewing things that may include the following:
- Verification of employment
- Credit history
- Proof of assets
- Income statements and consistency
If you receive pre-approval, you may include this accomplishment in your application for the homes you put in an offer for. When sellers see this detail, they may begin thinking of the reasons why you may be the perfect fit. For example, pre-approval generally means good financial standing which usually means the financing part of transferring a title will follow without a hiccup.
Shortening your search
A benefit of having pre-approval is that you may shorten your home search. Sellers tend to like pre-approved subjects because they are often more reliable than buyers who have no proven financial history. Because your pre-approval may take some of the guessing out of the selling game, sellers may bump your application to the top which gives you an advantage over the competition.