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Articles Why You Want a Pre-Approval By Cindy Snyder When you start house hunting, first get pre-approved for your loan. You need to show the seller that you are a viable buyer. Otherwise, you may lose it to someone who can prove they are ready to buy. In many areas of the country, it is a seller's paradise! Look at it this way, if you have a home to sell and you have two prospective buyers. The first buyer hasn't bothered to check into his finances. He hasn't been to the bank or mortgage company yet. Buyer #1 figures he will cross that bridge when he comes to it. On the other hand, Buyer #2 has already been to the bank or mortgage company to determine how much he can borrow, knows how much he needs to put down and has a good idea of how much he will need for closing costs. In his hand, he is holding a CERTIFICATE stating that he is PREAPPROVED for the amount needed to buy this house. Now if you are the seller of this house.......which offer would you accept? Now remember, when an offer is made and you accept, you are legally bound to the contract. Sure you could have a backup offer, just in case. But Buyer #2 is probably going to go on about his business of finding a home, since he is prepared to do so. If Buyer #1 is not able to obtaining financing, you are out of luck and must start over again. Sellers, if you accept Buyer #1's contract, be sure to put a contingency in the contract that he has so many days to obtain financing and be able to prove it. Buyers, get your pre-approval ahead of time. Be prepared to make an offer. Don't wait until the last minute only to find out that the home you are looking for is just a tad bit out of your price range. Maybe you were not counting your son's car loan as part of your monthly debt, but unless you can prove that your son is paying the payment.....it counts against your debt to income and may put you over the top! Many Real Estate agents won't even show you houses these days unless you get a pre-approval. They just don't want to waste their time showing houses to people who can't buy! A pre-approval is just what the word implies. You are actually pre-approved for a certain amount of money for a certain period of time, usually 30-60 days. This is not to be confused with a pre-qualification. With a pre-approval, you actually APPLY for a loan. We check your credit, verify your income, check to be sure that you have the money necessary for the down payment. Basically we do everything except the appraisal on the house and the title search. The great thing about it is that when you find the home you want to buy, it is a quick and easy process to close. That is good for you as well as the seller! Get your pre-approval. Carry it with you when speaking with prospective sellers. Show it to your Real Estate Agent if you are working with one. Be prepared to buy before you get out there. Happy House hunting! Cindy Snyder operates Creative Mortgage Co at http://www.creativemortgageco.com/ and publishes a monthly newsletter. To subscribe go to: http://www.yahoogroups.com/group/0nly4Homebuyers She also offers a low cost alternative to healthcare at http://www.firsthealthsource.com/