this happens, the new homeowner might have a great home, but a bad mortgage deal. You definitely want to avoid this happening to you.
WHY GET PRE-APPROVED
What’s the big deal about getting pre-approved for a mortgage in the first place? What’s wrong with going through the home- search and home-buying process first, and then getting the loan later? There is plenty wrong with waiting until the end for loan approval, and plenty of advantages in getting pre-approved for a mortgage first, before you get too far into the home-search and home-buying process. In fact, one of the most common mistakes made by buyers, especially if they’re first-timers, is not getting pre-approved for a home loan, as we discussed in Chapter 6. For example, many sellers and listing agents won’t want to work with you or even consider your offer if they find out you don’t have mortgage loan pre-approval and you’re promising that you can pay a certain amount when you can’t prove you can keep that promise. You will most certainly lose out on getting that home you had in mind. As I wrote in Chapter 6, “Your own assumption about what you can afford — both the down payment and the monthly mortgage payments, among other costs — can contrast significantly with what the bank is willing to lend you.” Getting pre-approved for a loan is also a fantastic method for gaining the upper hand in multiple-offer situations. A big part of presenting a strong offer is being pre-approved for a loan beforehand. If you and your agent come to the negotiating table confident, presenting a strong offer with a mortgage pre-approval letter in hand, you’ll already stand out from the other buyers interested in the same home.
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