With the Triangle market heating up more and more sellers are finding themselves in multi-offer situations. What can you do as a buyer to make sure you're ready when buying your next house? The number one item is to get Pre-Approved!
It used to be that to be pre-Qualified was all that was needed. But in today's market many of our areas are seeing LOW inventory rates of 3 or fewer months and many of our sellers are getting into multiple offers. One agent I spoke to placed a listing on MLS and had twenty showing requests and seven offers the very next day.
Buyers are confused about the difference but the best way to look at it is this. Pre-Qualified is the initial step of the home loan process. You'll provide basic info and the lender provides a quick idea of what you could afford. There are even a number of sites available that allow you to create your own pre-Qual letters. Many sellers and listing agents view them about as valuable as the paper they're printed on.
Not so with a Pre-Approval letter. This is a much more involved step and takes into account all of your personal financial data (income, expenses, credit lines, credit lines at max, etc.) The loan officer will even pull credit. This step will give you an exact amount of what you can afford - which is extremely helpful when beginning the home buying process. Your real estate agent will love it as they'll know exactly what you're looking for price wise and your potential seller will love it because they'll know you're serious. If competing offers come in and the seller has an offer that is only pre-Qualified and another that's pre-Approved the pre-Approved has a tremendous advantage.
The other benefit is that when you find the home of your dreams the committment process (suitably called Loan Commitment) that's needed during the due diligence period and utltimately leads up to closing is much smoother. Just be sure not to inquire about additional credit lines, go shopping for flat screen TVs and new furniture - save that until after your home purchase closes as your income and credit will be checked at least once more prior to closing - in some cases an hour or two before closing and funding occurs.About Don
When Don goes to work for real estate buyers, sellers and investors, he brings more than twenty years of sales and marketing experience coupled with strong communication skills and business acumen, which leads to great results.
He's a member of the National Association of REALTORS®
, the North Carolina Assocation of REALTORS®
and the Raleigh Regional Association of REALTORS®
He loves working with buyers and sellers and serves the Raleigh, Cary and Garner areas of North Carolina and also helps out of state buyers and sellers through Fonville Morisey's Relocation Services. To learn more about Don please visit his website