The Power of the Pre-Approval
THE POWER OF THE PRE-APPROVAL
The answer is NO!
A Pre-Qualification is a general idea of what you could qualify for without doing a credit check. It is an estimate of the loan amount you may qualify for.The pre-Qualification is not a sure thing and doesn't carry weight like a pre-approval does.
A Pre-Approval is a complete look at the borrower's credit history. The lender will perform a credit check, look for outstanding debts, collections or liens.
The borrower then is given a conditional commitment in writing with the loan amount, interest rate, and the loan type they qualify for.
Side Note: Some mortgage companies put you in pre-underwriting to do a thorough credit check as soon as you apply for a home loan.
SHOW YOU ARE SERIOUS
Being pre-approved in today's market is the single most important thing you can do to show a seller and your agent you are serious about buying a home.
Having the approval gives the seller confidence that you are able and willing to buy their home. And the likelihood of the loan falling through is very slim.
Pro Tip: Have a local well established mortgage lender.
IT'S A SELLERS MARKET
Demand has exceeded the supply of homes creating a 'Seller's Market'. Values of homes have risen tremendously during Covid building even more equity. The 2022 market forecast has shown it will remain a Sellers' Market until early to mid 2023.
If you are curious about how much equity you have built in your home, click here.
HOMES ARE SELLING FAST
The average number of days on market for homes in Jackson County is 35. Homes in the $300-$475K range sell much quicker, usually within a few days and have multiple offers.
WHAT THIS MEANS FOR SELLERS
Demand has exceeded the supply of homes which has created a 'Seller's Market'. Prices have increased roughly 17% within the last year building even more equity.
WHAT THIS MEANS FOR BUYERS
A seller's market also provides its challenges for buyers. Buyers are at a slight disadvantage. Homes here in Southern Oregon usually have multiple offers within days.
Having the pre-approval done and presenting it along with your offer will put you a step ahead of other buyers. Buyers can still have offers accepted even in a multi offer situation without overpaying.
If you are just starting out on your home ownership journey, please save yourself time and find out if you qualify for a loan first. Take it from me, nothing is worse for a Realtor than seeing their client find a home they love only to find out they cant afford it. 💔
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