Make it Easier on Yourself So You Can Act Fast in a Hot Real Estate Market

One of the topics I'd like to talk today about is the difference between getting prequalified and also getting preapproved, or some will call conditionally approved and the importance of this in acting fast in a hot market. I hear this all too often, "I'm not ready to get approved until I find the perfect home."

Well, the great news for us and lenders, so that is, that we actually preapproved buyers and not typically houses. Yes, the house has to qualify. Yes, there's certain restrictions. But typically we are getting you, the client, approved and ready to purchase the right house. Here's some of the top reasons I would encourage you to get preapproved right away, and get preapproved or conditionally approved versus getting prequalified.

Let's talk about the difference between getting preapproved and what we generally call prequalified. The best way I can explain is it's like receiving that letter you get in the mail where it says, Hey, you've been prequalified for a hundred thousand dollar credit card.

They're extending an offer based on data that they've put together. They think they can give you the loan, but it's not done until they've actually reviewed your income documentation, your credit profile. There's a couple things that they're going to look at before they actually will extend that offer to you.

It works the same way in the mortgage business. Some people will say, Well, based on your credit, you should be prequalified, but did they actually review your income docs and your asset docs to actually take you to the next level of qualification? It's the same way when we get to mortgage lending.

Let's face it, I've seen way too many bogus pre-qualifications from other company because the lender didn't do their due diligence to review the credit profile thoroughly, or look for anything else, like pay stubs, tax returns, or any other important documentation that could keep you from getting the loan. Usually it comes down to some of those items, but it's some of the top reasons why I recommend getting preapproved instead of pre-qualified to make sure that everything has been thoroughly reviewed.

So when you first start thinking about a move, it usually escalates very quickly. You find a house you love, you want to act on it, you and the whole family have fallen in love with it, and you haven't actually taken the step to get preapproved, so it's time to act fast.

If you're waiting for a lender to review all of your documents, it could take days, if not weeks, depending on how complex the situation is. You really want to be ready with confidence so that you can buy that house that fits your family needs.

Secondly, the worst thing I've seen is where families fallen in love with the home, shown it to the entire family, only to find out the lender failed them by not giving them a solid preapproval or conditional approval. This is very heartbreaking for everybody involved. Thirdly, once you have contracted home to buy, it can become very stressful. It's not a fun process. I've been doing this for almost 20 years now. I wouldn't say it's enjoyable.

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Everybody wants a home, not necessarily alone, but we're here to make this as painless as possible. So some of the things that become very stressful are the inspections, the appraisal, the title search, the insurance set up and requirements. Generally it can be overwhelming in such a short time for once you get a house contracted till it's time to close. Paperwork for the lender is just icing on the cake and can add to all the stress.

So that's generally why we will get as much of that paperwork up front to avoid any extra stress during the process. But if a lender did a lousy job, the paperwork wasn't accurate and you're scrambling to get it all together during the process while you're dealing with all of these other things. So I'm very proud to have a team of very experienced mortgage professionals.

We're known for giving accurate approvals, as long as you're as honest as possible on the application. We do a very good job of making sure we've dotted the I's, crossed the T's. We know what to look for. We know through experience what has caused problems, and we want to avoid those headaches for you. If you're looking to buy you're anywhere in the state of Texas, we would be honored to get you preapproved or even give you a second opinion. If you think you've already been preapproved by someone else, give us a call today.