In many markets across the country, the amount of buyers searching for their dream home greatly outnumbers the amount of homes for sale. This has led to a competitive marketplace where buyers often need to stand out. One way for buyers to show they are serious about buying a dream home is to get pre-qualified or pre-approved for a mortgage before starting a search.
In the hot Dallas-Fort Worth real estate market, to be taken seriously by sellers, buyers must be pre-qualified or pre-approved for a mortgage amount before starting a search.
But even if buyers are in a market that is not as competitive, knowing the real budget gives the buyer the confidence to know if a dream home is within reach.
Freddie Mac lays out the advantages of pre-approval in the My Home section of their website:
“It’s highly recommended that you work with your lender to get pre-approved before you begin house hunting. Pre-approval will tell you how much home you can afford and can help you move faster, and with greater confidence, in competitive markets.”
One of the many advantages of working with a local real estate professional is that many have relationships with lenders who will be able to help a buyer with this process.
Once the buyer has selected a lender, he or she will need to fill out their loan application and provide them with important information regarding “credit, debt, work history, down payment and residential history.”
Freddie Mac describes the 4 Cs that help determine the amount a buyer will be qualified to borrow:
Capacity: Your current and future ability to make your payments
Capital or Cash Reserves: The money, savings and investments you have that can be sold quickly for cash
Collateral: The home, or type of home, that you would like to purchase
Credit: Your history of paying bills and other debts on time
Getting pre-approved is one of many steps that will show home sellers that a buyer is serious about buying and it helps speed up the process once an offer has been accepted.
Many potential home buyers overestimate the down payment and credit scores needed to qualify for a mortgage today. If you are ready and willing to buy, you may be pleasantly surprised at your ability to do so as well.
Contact a Real Estate Advisor | REALTOR® from Martin Real Estate Advisors, a United Real Estate Company, today at 469-262-5411, or just complete the GET IN TOUCH form on this page, and let us know you are serious about buying, and we will contact you as soon as possible
We will discuss your desires and your requirements, and connect you with one of our preferred lending partners based on your current circumstances.
Shared content credit with Keeping Current Matters at www.simplifyingthemarket.com.