If you are shopping for a home in Cooper City or elsewhere in South Florida, it is worth taking the time to get pre-approved for a mortgage. Not familiar with mortgage pre-approval or its benefits? Let’s go over some of the reasons you should get pre-approved for a loan.
What is a Pre-Approval?
Pre-approval is a process by which we are able to determine whether you likely qualify for a mortgage.
Although it is not a guarantee, it does mean that based on our initial evaluation, we would expect you to be approved for a loan.
Final approval in the form of loan commitment takes place after the underwriting is complete along with the appraisal.
When you get pre-approved, you receive a pre-approval letter that you can use during the home buying process.
Advantages of Getting Pre-Approved for a Mortgage in FL
There are a number of benefits of pre-approval. Here are some ways in which a pre-approval letter can make life easier when shopping for a home.
- Find out what you can afford. Pre-approval involves pulling your credit. Unlike pre-qualification, which is based on your word, it provides an objective assessment of how credit-worthy you are. Based on that, your pre-approval will tell you roughly how much money you can expect to borrow given your financial data. Before you take this step, you are only guessing at the loan amount that you are likely to be approved for.
- Know what kind of interest you can expect. Just as pre-approval gives you an estimate for how much you will be able to borrow, it also includes an estimate of the interest rate you may qualify for. Having this estimate can help you make a determination about how much you should pay for a home given your budget. For example, if the interest rate is higher than you were expecting, you might realize that you need to be shopping for a more modest home then you would have otherwise. Conversely, if you are pre-approved for a lower interest rate than you were expecting, you might realize that you have more room in your budget for a more luxurious home.
- Lock in a low interest rate. At Premier Lending Corp, we not only can tell you what interest rate you qualify for, we can also lock in a low interest rate for you when you are pre-approved. That way, you can move forward in your home search with confidence, knowing that you will be able to afford your interest rate when you sign on your mortgage.
- Narrow down your home search. Without pre-approval, you cannot be sure how much home you can afford. As a result, you might waste time checking out homes that you ultimately would not be able to buy. But if you get pre-approved for home loan, you will be able to calculate how much home you can afford based on the amount you can borrow and the down payment you can make. That means that you can narrow down your home search to only those properties that you can realistically afford. The entire home buying experience will be faster and smoother as a result. You also will not face unexpected disappointments by getting set on a home only to find it is out of your price range.
- Show sellers you are serious. When you have a pre-approval letter to show to a seller, that seller knows that you are further into the lending process then a competing homebuyer who does not have pre-approval. The letter proves that you have the credit to qualify for the mortgage that you will need to purchase the property. Since the seller will know that you are serious and capable of purchasing the home, they will take you more seriously in return. That means you have an edge over other buyers and are more likely to get your dream home.
Get Pre-Approved for a Mortgage in Florida Now
At PLC, we make mortgage pre-approval in Florida fast and easy. To get started, please give us a call at 954-840-8811. Once you are pre-approved, you’ll be one step closer to buying a beautiful and affordable home!