Home Buying in Mineral Bluff>Question Details

James, Other/Just Looking in 30052

Is it normal procedure for a seller to ask for a approval letter (not pre-qualify) from a buyer prior to obtaining a signed contract.?

Asked by James, 30052 Mon Oct 18, 2010

This is a bank owned property.

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Annette Levinson’s answer
It is called a preapproval since an approval requires that the house is known. The preapproval lets the seller know that you can get a mortgage before he takes the house off the mortgage.
It can take 60 days to close and the seller does not want to loose this time if you are unqulaified to get a mortgage.
0 votes Thank Flag Link Mon Oct 18, 2010
James --

The answer is yes, that's very normal. It's one of the many hoops you may be asked to jump through when you want to buy a bank-owned property. The banks look most favorably at cash purchases, but if you don't have all cash, they want a high degree of assurance that the transaction is going to close. That's why they want offers from buyers who are already approved and ready to go. It means one less reason the transaction might fall apart.

Although it might seem intrusive or demanding to you, it's really in your best interest, as well. You'll feel a lot better about your offer when you know that there aren't going to be any problems with your loan. And believe me, in today's lending environment, even many people who think there's absolutely no problem for them to get the loan they want get blind-sided by unforeseen home loan problems.
Make sure you get a good lender, meaning a good rep. Get some recommendations from people with actual experience with that loan rep. If you don't, you may regret it.

By the way, good for you to be buying now. Those who wait are likely to look back and kick themselves for waiting around during this time. Best of luck to you.

Mike Personius
DallasShortSaleBlog.com
Keller Williams Realty
1 vote Thank Flag Link Mon Oct 18, 2010
Obtaining a pre-approval letter is the only way the seller can assure that a lender has made a commitment to give you financing. This is to avoid the property being taken off the market and then finding out the buyer's financing is not in place.

Pre-qualification letters are not worth the paper they are written on. More often than not, the loan officer has not verified the buyer's debts, assets, pay stubs, or tax returns.

Best of luck to you!
Web Reference: http://www.DesariJabbar.com
0 votes Thank Flag Link Mon Oct 18, 2010
Yes.

Pre-quals are much weaker, as many sellers have found out the hard way. I can't speak for Mineral Bluff, but in many areas of the country a preapproval letter is pretty much standard.

Hope that helps.
0 votes Thank Flag Link Mon Oct 18, 2010
Don Tepper, Real Estate Pro in Fairfax, VA
MVP'08
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