Local ATX Living!: The Benefits of Getting Pre-Approved for a Loan When Buying a Home – Austin, TX

The Benefits of Getting Pre-Approved for a Loan When Buying a Home – Austin, TX      

I have spent several hours of the last week doing a complete overhaul of my real estate website.  I decided to go it alone this time, thus the drastic increase in time it has taken to get up and running (I think it looks good though – check it out!).  While writing content for the site, I was writing about the lending process and why getting pre-approved for a loan is so important.  Then I had an “ah ha” moment and decided it would make for a great blog post.

I have an announcement for first time home buyers and those thinking of buying a home in the near future.  If you feel confused, scared, nauseas, overwhelmed, or stressed about the idea of buying a home in the coming months, you are in for some good news.  That is completely normal, and you are not alone.  Let’s face it – buying a new home (especially your first) is a catalyst moment in your life!  These important moments in life will never be without doubt or uncertainty.  Having those emotions present help you realize the magnitude of what you are about to do.

Now, the purpose of this post is not to scare the living heck out of you.  It is to help prepare you.  The most challenging part of the buying process in today’s market is the lending process.  Changes are taking place nearly every month.  I will admit – the process is confusing (most real estate agents won’t admit this but many are thinking it).  Therfore, getting pre-approved for a loan is the best thing you can do early on.  Ken Cook wrote a great article about understanding what “points” mean on a home loan.  It is one aspect of a complex process.  Let’s face it - there is a lot of information available today.  The hard part is determining which is reliable, accurate and true.               

The very best thing you can do prior to getting pre-approved for a loan is speak to an experienced lending professional.  They will explain the process as in-depth as you require.  But I want to share the benefits (and the actual topic of this post) of getting pre-approved before you even step foot in a home for sale. 

• You will know where you stand with your credit score.  Credit score is one of the biggest factors in determining if you qualify for a loan.  Whether you are using conventional lending, FHA, USDA - it matters.  If your credit needs work, that’s ok!  Your lender can help you improve it.  Damaged credit is temporary and can be fixed (post that on your mirror so you see it every day)!
• Along with knowing your credit score, you will know how much you can afford.  As mentioned before, buying a home is a big deal and you have to be serious about where you stand financially.  If you are not where you want to be, then work with you Realtor and lender to create an action plan on what you need to do and set goals for getting pre-approved for a higher loan amount.
• It will help Realtor help you.  Most agents have experienced working with a client who claims to afford homes in a certain price range, then finds out much later that isn’t true.  Our job as real estate professionals is to make sure you get exactly what you need and want.  Let us help you!
• A pre-approval letter will strengthen an offer you submit to a seller.  It shows the seller you are ready, willing, and able to move forward and buy the home (after you have the home inspected, etc.).  It is also a courtesy to those sellers whose homes you visit.  No one wants tire kickers filing in and out of their home all day long. 

The opportunities for buying a home in today’s market are incredible.  If you are confused about what to do, you are in the majority.  While the process is detailed and complex at times, there are people who want to help you.  Find a Realtor and lending you trust and start putting a plan together.  Getting pre-approved is one of the first phases, and will help you determine what your next move will be.  You’re one step closer to your dream on owning a home!