Part 3 – The Pre Approval
So here we are, at your pre approval. We’ve discovered your “why” and formulated a strategic mortgage plan around your priorities and motivations. Now it’s time to get things going.
The first thing to address in the pre-approval process is the distinction between a pre-qualification and a pre-approval. Some may use these phrases interchangeably, but we here at the GreenHouse Group do not. And I will tell you why. A pre-qualification is a rough look at your situation, you tell us about where your credit score falls, what we have to work with as far as income and assets and we provide you with an estimated purchase price, rate and payment based on general loan parameters. This is helpful to have an understanding of where you stand in the market. If you know you have decent credit, a little money in the bank and make 60K a year, you might just want to know what ball park you’re in. Can you buy a house for around 500,000 or is it more like 200,000? And what does the monthly payment look like on a purchase like that? A pre-qualification is perfect for answering these questions, but it’s not enough to go shopping. You can’t submit an offer with rough numbers.
With a Pre-approval you can submit offers. In fact that is the purpose of the pre-approval from a buyer’s standpoint. Think of the experience of buying a home like going to Disneyland. It’s fun and exciting, there are times when you are moving fast, and there are times when you are waiting. There is a lot going on that you see, and a lot going on behind the scenes. Think of your home buying experience as going to Disneyland, and think of your ticket in as you’re pre-approval.
With a pre-approval we take a look at your specific financial situation. We gather bank statements, statements of investment accounts, look at your credit report, and examine your income. We look at all the things we need to submit your specific scenario to a specific lender. The numbers we come back with (interest rate, purchase price, down payment requirements) are all binding. The pre-approval we issue is as solid as the home you are about to purchase. It is important as a buyer, that you can shop with confidence, and that the numbers we gave you don’t change.
Now you have your pre approval. Now you can shop with confidence. Now you can put in an offer. And once your offer is accepted? Well, now, that’s when its stars to get real, because now you are in contract…
Questions? give me a ring or drop me a line. Scott@GreenMeansGrow.com 858.273.3663 ext 114