4 Benefits of Being Pre-approved for a Mortgage

Before you even find a home you’d like to buy, it makes sense to become pre-approved for a mortgage. This provides you with a document stating that lenders are willing to let you borrow up to a certain amount. Here are a few key ways preapproval can benefit you.

1. It Tells You What Price Range to Consider

When you know how much you can receive for a mortgage, you avoid wasting your time looking for houses that are outside your budget. Narrowing down your options can stop the home-buyer process from feeling overwhelming and help you focus just on properties that have the features you need or want. Being clear about your budget also prevents the heartache that comes from finding what you thought could be your dream home, only to discover that you’re unable to afford the property when you start talking to lenders.

2. You’ll Close the Deal Faster

The average time to close on a house is 50 days, but some sales take much longer than this. With preapproval for a mortgage, you’ll be able to receive financing sooner, which will mean you close the sale faster.

3. Your Offer Is More Likely to Be Accepted

A seller may receive multiple offers for the asking price. You increase your chances of being chosen if you have preapproval for a mortgage. This is because the seller can be confident that the deal will go through, since there’s much less risk that you’ll be denied sufficient financing. When the seller also wants to close the deal as soon as possible, preapproval is especially likely to be a big incentive.

4. You Have Leverage to Negotiate

When there’s more inventory on the market than people looking to buy, you’re at an advantage already. However, you have even better chances to negotiate if you have preapproval for a mortgage. A seller may be willing to accept an offer that’s less than the asking price just for the security that the sale is unlikely to fall through. Moreover, the seller may sweeten the deal in other ways, such as completing some home improvements before you move in.

The best way to become pre-approved for a mortgage is to talk to a mortgage broker. Fort Saskatchewan home buyers can become pre-approved in less than 24 hours with Flare Mortgage Group. Apply now to complete the process online.