If you’re looking to buy a home this year, the time to get prepared and prequalified is now. Getting a mortgage prequalification letter from your lender is crucial as you shop for a home.
The Benefits of Getting Prequalified For a Home Loan
A major benefit to getting prequalified is that it provides you with a realistic budget as you search for your future home. This helps you identify your price point and shop more efficiently. Many times, buyers get ahead of themselves and begin shopping for homes when they are unsure of what they can afford. Prequalification takes the guessing out of the equation and saves buyers time, energy and potential disappointment.
In the current real estate market, prequalification is essential, especially for first-time buyers. Being prequalified is not only smart but is sometimes required to make an offer on a home. In a multiple offer scenario, buyers without a letter of prequalification are often not taken seriously. Getting prequalified for your mortgage loan makes you more attractive to a seller, because it demonstrates that you’re a serious buyer with viable credit.
“One of the best tools a potential buyer can have in their toolkit is a letter of prequalification from their lender,” says Jeremy Holmgren, regional manager for Zions Bank Home Finance. “Once you are prequalified, you have a competitive buying advantage compared to those who have not yet begun the loan application process.”