One of the smartest things you can do if you want to buy a house is to get pre-approved early. This is true even if you don’t plan to do it right away. Why? Because, like anything in life, the right prep work makes things clearer.
The best time to get serious about buying is before you’re ready to buy. Here’s why.
Pre-Approval Helps You Understand Your Numbers
One great thing about pre-approval is that it lets you know how much you can afford. A lender will look at your income, debts, credit score, and other factors to determine how much you can borrow as part of the pre-approval process. Power is that number.
You won’t have to guess anymore once you know that. You know what you’re working with. That tells you what you need to know to make plans. That way, you won’t fall in love with homes that are too expensive for you or miss out on homes that are within your price range.
Pre-Approval Helps You Move Quickly When You’re Ready
You don’t have to be ready to buy to be ready to buy.
People scroll through listings for fun all the time, and then all of a sudden, they fall in love with something they see. Then they rush to find an agent and get pre-approved with a lender, but someone else gets the home before them, and they lose it. You don’t want that to happen to you.
You can’t decide when the right house will come up, but you can be ready for it when it does.
With pre-approval, you don’t have to rush or jump the gun on your timeline. It’s about being ready to go when the time comes. This is what Experian says:
And if you wait too long to get a preapproval, you might lose out. You might find the perfect home, but someone else could buy it while you wait for the lender to look over your preapproval application. Getting preapproved right before you start looking at homes might be the best thing to do.
You’re already in the game, so you don’t have to rush to do the math, gather the paperwork for your home loan, and watch the house you really want go away while you wait to hear from your lender.
It’s like getting to the starting line while everyone else is still looking for a parking spot but with your shoes tied and your warm-up done.
While pre-approvals are good for a certain amount of time, make sure you ask your lender how long it lasts. Bankrate gives us this information:
A lot of mortgage preapprovals are good for 90 days, but some lenders will only let you have one for 30 or 60 days. When your preapproval runs out, all your lender may have to do to renew it is check your credit and finances again to make sure nothing major has changed since the first time.
You have a much better idea of how to find a home within your budget if you’ve already been pre-approved, even if you’re only thinking about looking around. You’ll also be ready if the right house comes up. So why not make it happen?
Bottom Line
You don’t have to buy a house right away just because you got pre-approved. Yes, it does mean you’ll know what to do when the right one comes along. You need to talk to a lender to start the process of getting pre-approved.
Talk to an agent about what’s on your mind and what you want to find in the meantime.
Would you be ready to move tomorrow if the perfect house came up?