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Why You Need a Pre-Approval in a Competitive Market

Why You Need a Pre-Approval in a Competitive Market

Right now, the housing market is hot! The sellers have all the advantages with multiple bids and competitive pricing. If you are in the market for a new home, prepare to go the extra mile to impress a seller. Traditionally, buyers would share a pre-qual but now a pre-approval is more important than ever. A pre-approval will make you stand out with solid backing and a fast turn around. If a pre-approval does not get approved, the seller gets $1,500. A pre-approval will make you an attractive buyer, give you more compromises and push the deal through a lot faster. 

    First off, what is a pre-approval? A pre-approval is when you go into a home offer with full underwriting and a guarantee. Compared to a pre-qual which is not verified, but says that you will potentially be approved for a loan. A pre-approval takes a little longer and is a little harder to get, but is better in a competitive market. If you were selling your house, wouldn’t  you accept the offer with the guarantee? 

    Plus, a pre-approval gives you, the buyer, a little bit more of an advantage in the process. With the housing market being so hot right now, the sellers have all the advantage. Take some of the advantages back with a pre-approval. Since you are the most attractive buyer, the seller is more likely to listen and accept your bargains and negotiations. You will be able to make more compromises in the process. The deal will be able to go through a lot quicker so the seller will at least hear out your requests. 

    You will also get to close faster. Usually it takes around 50 days to close on a house. It takes so long because the buyers are going through the mortgage loan process. Since you already have the pre-approval, you can just skip to the next steps. You will be able to get an appraisal and inspection done quickly. It is a much faster process because you have all the financials sorted out. This again will make you an even more attractive buyer if the seller is trying to get out of their house fast. 

    Getting a pre-approval is now necessary if you want to stand a chance in the housing market. A pre-qual can only go so far when the market is booming. It shows that you are a serious buyer and will speed up the process. Knock out the competition with your approved financials.