It used to be that buyers could go house shopping and when they had found their dream home, THEN they would go apply for a loan. However, in today's market, that has proven to be one of the least effective methods to acquire your home.

Most lenders can pre-qualify you for a mortgage over the phone. Based on general questions about your income, debt, assets, and credit history, lenders can estimate how much mortgage you qualify for. However, being pre-qualified and pre-approved are different things. Pre-approval means that you have applied for a mortgage; you have filled out the mortgage application, received your credit report, and verified your employment, assets, etc. When you are pre-approved, you know exactly what the maximum loan amount will be.

A pre-qualified letter is not verified and in essence, does not count for much if you are competing with other buyers who are pre-approved. When you are pre-approved, you and the seller know exactly how much house you can afford. It gives you credibility as an interested buyer and lets the seller know immediately that you will qualify for a loan to buy their property.

In addition to being pre-approved, it's important to be pre-approved with a legitimate lender. While a lot of Buyers see internet deals and offers as the place to go, the truth is a high percentage of these people can't deliver on their internet promises. When your transaction is in trouble in Louisville, Kentucky, how much service are you going to get from the internet jerk in Montana??? When your lender is not giving you the right answers, we need to be able to "reach out and touch them" - that's "Realtor talk" for "kicking some tail."

If you'd like to discuss this issue, or any other issue further, please contact me below.