While both home sellers and lenders may require home buyers to obtain a pre-approval letter, this is a good practice to follow for your own sake. The pre-approval will provide a specific limit on how much you can spend on your new home. This will help you in your home search and keep you from committing to a home you can’t afford.
Limit Your Search for Real Estate in Asheville, North Carolina
One of the most practical reasons to get your pre-approval is that it will help you refine your home search. Without some criteria to limit your home search, you can spend hours of wasted time combing through listings that won’t meet your needs.
The pre-approval sets up a spending boundary that will limit your search to the homes within your price range.
Increase Your Chances for an Offer Acceptance
You'll want to make an offer when you find something you like among the available homes for sale in your community. Sellers are more willing to accept offers made by buyers with pre-approval letters. This is because the seller knows a pre-approval means the buyer can immediately move ahead with the purchase.
Get Ahead of Other Buyers in Your Area
The market for real estate in Asheville, North Carolina, is highly competitive, with multiplier buyers looking for homes within the same neighborhoods. This means you’ll need an edge to ensure you can beat out other buyers who want the same house.
Obtaining your pre-approval gives you that edge. Since you already have a lender, you’ll be ready to initiate the real estate transaction sooner.
Avoid Getting in over Your Head
Another advantage of getting pre-approved for your mortgage is that it will keep you from spending too much. Without that pre-approval, you may commit to buying a house that’s a little too far outside of your price range. This can make it harder to find a lender for the purchase.
Even if you do secure a mortgage, you might find that the monthly payments, including interest, are too high for you to afford comfortably. The pre-approval helps you avoid that situation. Your lender will ensure you can afford all of the hidden costs associated with buying real estate so you won’t overspend.
Shop Around for the Best Terms
Before you request a loan pre-approval from any bank, make sure to shop around. Comparing offers from multiple banks will help you find a lender that will give you the best terms. Paying less for your loan can add to your savings as you buy your new home and begin repaying your loan.