3225 Austin Bluffs Parkway, Suite 150 Colorado Springs, CO 80918 |
Fax: (719) 596-1440 Toll free:
(800) 989-7302
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3225 Austin Bluffs Parkway, Suite 150 Colorado Springs, CO 80918 |
Fax: (719) 596-1440 Toll free:
(800) 989-7302
|
| “The first step used to be one
of the last.” This is according to an article taken from the
Gazette, Colorado Springs’ local newspaper. It used to be a common
practice for home buyers to select their new home before going to the lender
and getting their financing arranged. But over the last few years
this trend has changed.
The article added that “…by the time potential homeowners are looking at houses, they already should have talked with their mortgage lender.” By getting with a mortgage lender, one of two things can be accomplished, a pre-qualification or a credit approval. Allow us to explain the difference. Pre-Qualification. This is usually a quick, simple, and informal way to determine a home buyer's price range. With income and debt information, a loan officer can calculate a monthly payment and the sales price a home buyer might qualify for. The loan officer will also look at the amount of cash available to the buyer for the down payment and closing costs. The idea behind the ‘pre-qual’ is to give a buyer an estimated price range in which to shop. It is by no means a guaranty that he will receive a mortgage loan.The Gazette goes on to say; “The industry standard of pre-qualification letters for a loan amount is giving way to buyers who have gone through the credit approval process – without a specific property in mind…Those pre-qual letters are just not holding up like they used to. Buyers who get a credit approval are viewed much more favorably by the sellers.” When you find the house you want to buy and you're ready to make an offer, you'll need to consider the offers that you may be competing with. “More than one third of the home buyers go through the process of being credit approved, and that number is growing!” says the article. Also noted in the paper was the confidence and relief you get with a credit approval. “…so you can walk around with that great feeling of ‘I've got $150,000 in my pocket’. They (buyers) become much more excited and everyone is more relaxed, especially the first time buyers.” Should everyone just go for the credit approval? Not necessarily. At the very least everyone should get pre-qualified, if only to establish a plan for home buying in the future. But if you are ready to start shopping for your new home, arm yourself with every possible advantage and get your mortgage loan credit approved. |
Call us with your questions
at (800) 989-7302 or send an e-mail to: info@prmcolorado.com.
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