First time home buyer mortgages can be a confusing task. Searching for houses and finding out that your finances don’t cover it can be a bitter shock in the pleasant process of searching a home for you and your family.
- You can have a clear idea of what you can afford.
You must have heard a lot of people tell stories if they had found the perfect home but they had to give it up because they found themselves without financing at the point of purchase. Having a clear idea of what you can and cannot afford is very essential. By getting pre-approved for a first time home buyer mortgage, you can get an idea of what your budget is. It can also help you determine your first time home buyer mortgage limit.
- Pre-qualifications are just not enough.
First time home buyer mortgage lenders can provide you with a certain rate for your loan. This is a pre-qualification. In this process, the lender does not check your credit score and hence you don’t know if you qualify for the mentioned deal. Getting pre-approved means that you are guaranteed the mentioned rate for your first time home buyer mortgage. This allows you to bid with confidence.
- It can give you leverage in a bidding war!
Having an approval letter for your first time home buyer mortgage allows you to have leverage over competitors and bidders who do not have the pre-approval. The pre-approval letter goes to show that you are capable of paying the amount required for the home and makes you look serious about your offer.
- You can conduct a focused search.
When you are pre-approved, you can search a home based on what you can afford. The realtor you work with will have a guarantee that you are serious and the deal isn’t a waste of his time. He will work extra hard and with a better idea of what you need to fulfill your requirements.
- Sellers are ready to negotiate with pre-approved buyers.
You can get multiple benefits such as lowered costs, added appliances and more when compared to non pre-approved buyers.