Shop the rates depending on what you need but the more often your credit is run the more it may effect your credit score and the percentage rate you can get. If you are a serious buyer please do get pre approved then you know you should be good to go when you find a home that you love. Not getting pre approved first and finding out you can't buy the home you love is really depressing.

It is a good idea to speak with several banks to find out who can offer you the best rate and loan program but you only need a pre approval (to make offers) from one bank. Just so you know, you dont have to use the bank or broker who gave you the pre approval for the loan when it is time.

Hope that helps!

Hi Tara,

I think it is a good idea to ask 2-3 people for rates and programs that they offer and what they could do for you financially. Some that I work with also have programs they can put you in to give you ideas on boosting your credit score to get you financially successful to buy a home in the future if you have a lower credit score currently. As a realtor, I always suggest trying to find a personal referral from your friends or family, or another professional so you know that mortgage broker or bank is reputable and knowledgeable in the mortgage industry.

I had a friend of mine go to an online mortgage company (forgoing my suggestions) because they promised him a great rate and then ended up paying $1700 more at the time of the closing because the rate quoted was different than what he actually was getting - Not great news to get when you're only a few days from closing and may not have that kind of money!

I think once you've talked with those few people, then find one that you like and would want to stick with if you choose to start the buying process. Have him/her then pre-approve you by giving you a letter you can present with all offers. I usually talk with the mortgage broker of my buyers and have them write up a letter that fits the price range of the offer so the listing agent and seller can't really tell how much more you can afford, but works within the range of the offer.

Now is a great time to buy, especially with the up to $8000 first time home buyer's tax credit, but if you want to go for the credit, then I would suggest putting in offers by sometime in October to be able to close by the December 1st deadline. Good luck with your search and if I can be of any assistance or refer you to one of my mortgage brokers, let me know.

Angela Dolber
Prudential Prime Properties
angela@pruprimehomes.com

I agree with Rob. I was a credit analyst for a National Bank for many years. Your credit score will drop if you out right cancel credit cards, because you are reducing the amount of credit that is availble to you.
When purchasing a home, do your homework. Not only on the home you are buying but also the mortgage you are going to take on. I wouldn't go out and get 20 pre-approvals. I think a handful should be OK.

What is your objective ing getting pre-approved? For most people its so a seller will take your offer seriously when buying a home.

The pre-approvals I am familiar with are for a specific loan amount and indicate a LTV (loan to value) ratio. Once a lender preapproves you for a specfic loan amount, you may always ask them to change the letter to indicate a lower amount if you are offering less on a home than you are pre-approved.

Also tread carefully... a bank, credit union and a direct mortgage lender (vs a mortgage broker who is only an agent for a lender) can give you an authentuic pre-approval. All other letters are just pre-qualifications.

Tara,
The answers you've received are great. I'd like to clarify one small detail. The first time home buyer's tax credit is only available to closings which happen before November 30, 2009. If you close during December you are not eligible. Be sure to talk to your lender about the details.

Tara,

Some responses below indicate that your score will drop with multiple inquiries, so I have copied the facts directly from the myFICO.com website here:

Fallacy: My score will drop if I apply for new credit.
Fact: If it does, it probably won't drop much. If you apply for several credit cards within a short period of time, multiple requests for your credit report information (called “inquiries”) will appear on your report. Looking for new credit can equate with higher risk, but most credit scores are not affected by multiple inquiries from auto or mortgage lenders within a short period of time. Typically, these are treated as a single inquiry and will have little impact on the credit score.

As you can see, it may be beneficial to get pre-approved by more than one source if it does give you greater options and greater peace of mind.

Good luck,


Rob Spinosa
rspinosa@mortgagemasterinc.com

HI Tara,

I agree with Egal Shamash's answer. You can shop and you will not really be affected unless you are in a low credit score position to start. Good luck with your search!
If I can be of any assistance please call/text/email me anytime.
Ann Marie
ReMax
annmariebelair@comcast.net
5085232676 cell/text http://www.annmariebelair.com http://www.annmariesblog.com

Hello Tara,
I recommend getting multiple opinions, even if you are referred to an individual. I can't tell you how many loans I've done for folks when they have been promised the Sun, Moon, and stars. Pulling your credit multiple times can jeopordize you if you are on the borderline of being demoted to a lower tier on a rate sheet. If a loan officer submits your paperwork to FHA and obtains a case number, you will not be at liberty to use a different lender till that case number is released. Should you have any additional questions feel free to give me a call. I can be reached at 415-424-4349. Al

Tara,
You do not want to go to more then one person to be pre-approved because multiple credit checks will bring down your credit rating. If you want to check with a few loan officers to interview and ask about their fees that is fine but do not let more than one check your credit report. If I can be of assistance with this process, let me know. I work with a couple of great lenders. If you are a first time buyer remember there is an $8000 credit if you are closed by December 31, 2009. For more info on this contanct me. 810-225-8106 or email me at sharon@sharonkoch.com