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Trulia Denver, Home Buyer in Denver, CO

Do you have to be pre-qualified to start the homebuying process?

Asked by Trulia Denver, Denver, CO Mon Apr 8, 2013

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Trulia Denver,

In this market the answer is yes for several reasons. 1. If you are not pre-qualified there is no way to narrow down the search. Neither do you know if there are issues that would preclude a purchase now. 2. If you are not pre-qualified the time it takes to do so could cost you a purchase since the sellers would not consider your offer. In this tough and tight market with low inventory, time is of the essence. 3. I counsel my buyers not only to get 'pre-qualified', but 'pre-approved' as the first step in the process. Pre-approval is when the lender has taken all of your information to pre-qualify you and also has verified, funds, employment, credit issues, and more. So you are ready to move quickly. 4. Not only will the seller take your offer more seriously by having a pre-approval letter to present, but it narrows down the search for you and your Buyer Agent, and there are no surprises moving forward.

Robert McGuire ASR
Your Castle Real Estate
Direct - 303-669-1246
1 vote Thank Flag Link Mon Apr 8, 2013
I would say you do not have to be pre-qualified…you have to be preapproved.

Sellers will not take your seriously if you try to make an offer that is not accompanied by a preapproval letter.

Realtors will not take your seriously if you expect to look at houses and you are not preapproved to buy.

You should not consider yourself to be serious if you are not preapproved. You don’t even know if you can get a mortgage or for how much.

It is a new ball game as far as the home buying process is concerned. To shop for a home without being preapproved is like going hunting with an empty gun. You will not bring anything home.
1 vote Thank Flag Link Mon Apr 8, 2013
All good answers.
One more issue to consider: in today's market, frequently homes are going very fast, sometimes the first day they hit the market. If you find a home you really like, if you aren't pre-qualified for the loan there is a very good chance that you will simply miss out. With multiple offers on a property, a seller will not even consider an offer without the buyer being pre-qualified for their loan. And, with many lenders, you can get this process started and get your prequal letter very quickly.
Best of luck.
Chuck Strauss
Your Castle Real Estate
1 vote Thank Flag Link Mon Apr 8, 2013
If you're wise and want to win when you're competing for the home you've found; you'll want to be pre-approved. Prior to home shopping.
1 vote Thank Flag Link Mon Apr 8, 2013
Kasha knows what she's talking about! One of the best Realtors in Denver!
Flag Mon Apr 8, 2013
You do not HAVE TO be pre qualified to start looking. However, without knowing, if you can get qualified for a loan and knowing your price range and payment amount, is like going "window shopping" - you can look, but cannot buy. If you happen to find a home you can't live without, you want to be ready to make an offer, which involves providing the sellers with your pre qualification letter.

Marina Bay
Cherry Creek Properties
1 vote Thank Flag Link Mon Apr 8, 2013
No, you do not have to be... BUT if you are not pre-qualified, how do you know what you qualify for? Will you be looking at the price point that is realistic in the future for you?
Also, in this market, without a pre-qual letter, when you make an offer, and the seller is looking at your offer among others, you will not be chosen. That pre-qualification is crucial if you are serious about purchasing a home!
And, also what Michael said below, as an agent, we have no starting point for buyers without a pre-qual price in mind.

Nicole Gilbert
Associate Broker Keller Williams Downtown
1 vote Thank Flag Link Mon Apr 8, 2013
Technically NO but 99% of real estate agents/brokers will require you to be before showing you homes.

If you would like to get pre-qualified or pre-approved I would be more than happy to assist you.
1 vote Thank Flag Link Mon Apr 8, 2013
No, however most agents would want to know you have met with a lender to discuss various financing options, as well as to determine overall affordability. Contact me if needed I would love to help!
0 votes Thank Flag Link Tue Oct 22, 2013
As others have said, pre-qualifying is not a necessity technically speaking, but in order to have your offer taken seriously by a seller, you'll need a pre-qual letter to submit along with it. It simply lets the seller know you can back up your offer with the finances.

In the mean time, if you'd like to start a home search with a local expert, I'd love to chat with you about your needs and wants in a new home situation. Feel free to call or email me anytime!

Alex Frazier
Keller Williams Realty Downtown
0 votes Thank Flag Link Mon Oct 21, 2013
Getting pre-qualified is a good place to begin so you can see what are the available mortgage programs. Also, by identifying the particular mortgage loan program you can get a idea of the monthly mortgage payments, downpayment requirements and overall settlement charges. Speak to a licensed mortgage professional in your area to start the process. Best of luck!
0 votes Thank Flag Link Mon Oct 21, 2013
You should be pre-qualified. Not going through this process puts you at a true disadvantage as a buyer. Talking with a lender first lets you know exactly how much home you can afford and how much down payment you need. Additionally, depending on the type of loan you qualifty for, the property may need to be in a certain area (i.e., USDA financing). Do yourself a favor, talk with a lender before you start touring properties.
0 votes Thank Flag Link Thu Oct 17, 2013
No, you do not need to be pre-qualified. And it usually not at all necessary at the beginning of the process unless you plan to move very quickly. Usually buyers need to see some homes before they are ready to start making decisions. So a couple forays into the market usually represents a good place to start. Then the buyers can start talking to lenders.

Kind regards,
Ron Rovtar
Prudential Real Estate of the Rockies
(Soon to be Berkshire Hathaway HomeServices)
0 votes Thank Flag Link Thu Oct 17, 2013
No, but only agents with nothing to do are going to spend much time with a buyer who has no idea whether they can actually make an offer on a property and get a mortgage. If buyers want to be taken seriously one of the first things they need to do is get preapproved for a mortgage.

Prequalifed means nothing, unless a buyer has had a full tri-merged credit report pulled, and has supplied a lender with the necessary paperwork so that they can verify the buyers income and assets, then neither the buyer, their agent of the seller has any real idea of whether the buyer can in fact get a mortgage or not. As most areas of the country are seeing less than 6 months worth of inventory on the market which indicates a sellers market, sellers shouldn't and won't give much credence to a buyer who isn't prepared with a full preapproval letter that accompanies their offer.
0 votes Thank Flag Link Sun Sep 29, 2013
Yes. You need to make sure that your approved and for how much. A seller will not even entertain an offer without some sort of pre approval, most agents will not show you any homes until your approved either. I can help you get pre approved and I have several really great real estate agents in Denver I can refer you to as well..
0 votes Thank Flag Link Sat Sep 28, 2013
Good afternoon,

First steps:

Meet with a Local Mortgage Banker to get prequalified for mortgage financing. The Mortgage Banker will review all facets of your loan request to answer your questions with regards to the types of loans and maximum loan amounts you could qualify for.

Line up a Home Inspector. A good home inspector will scare the heck out of you: that's what you pay him for! But you'll concentrate on the fundamentals of the property: roof free of leaks, plumbing, heating and electrical up to code and in good working order. Again, when you make an offer and you have your Home Inspector ready to go, your offer will be considered with much more interest by a Seller because you truly have your "ducks in a row" and your preparation demonstrates your serious attitude about conducting the purchase transaction in a timely manner.

Find an experienced Local Realtor who works in your desired shopping area. A serious pro Realtor will refuse to show you homes until you are Prequalified for mortgage financing. Don't take offense! That Realtor doesn't want you to be disappointed and wants you to have a smooth experience as you shop for your new home.

Trevor Curran
NMLS #40140

*If you thought my answer was helpful, please give me a “Thumbs Up” or “Best Answer.” Thanks!
0 votes Thank Flag Link Wed Jun 12, 2013

If you are not preapproved no agent will waste their time writing an offer for you. Many will not even show you properties unless you have been preapproved.

Kawain Payne, Realtor
Prudential California Realty
0 votes Thank Flag Link Tue Jun 11, 2013
No you do not have to be pre-qualified to start the homebuying process but you absolutely should be pre-qualified. The further along you are in the loan process the stronger your negotiating power will be when you make an offer to purchase. Many Realtors won’t take potential buyers out to look at homes unless they have been prequalified. Of course you should know how much you can borrow, how much you want to spend on mortgage payments every month before you start shopping. Be smart and start your loan process first buying a home is a big step and a long time financial commitment, be prepared.
0 votes Thank Flag Link Sun Apr 14, 2013
I would say no, however without the pre-qual would be like driving a car blind folded... well maybe not that bad, but one will not know where to start looking. So get the pre-qual and follow the yellow brick road!

Willie Trevino
Tenant Screening USA
0 votes Thank Flag Link Tue Apr 9, 2013
Great question...In our current market of low inventory with many buyers you need to be prepared to act right away if you like a property. No sense of just not being prepared to write an offer. Most listing agents won't present an offer without a lender letter and pre-qualified is much better than pre-approved.

Much success in your home buying process, I'm here to help in any way you might need!

Bill Pearson GRI, SRES |"Your Denver Realtor For Life"
ERA Herman Group Real Estate| 201 Columbine Street| Suite 301| Denver CO 80206
720-329-1470 |
5280 Magazine FIVE STAR Real Estate Professional – 2010, 2011, 2012
0 votes Thank Flag Link Tue Apr 9, 2013
No you don't have to be but getting pre-qualified you will be able to look at homes you can afford and not spend your time looking at ones you can't buy.

If you need help getting qualified I would be willing to help you out.

Luther Baumer
Keller Williams Advantage Realty LLC
0 votes Thank Flag Link Mon Apr 8, 2013
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