QandAs: Loans

What Does it Mean to be Pre-Approved?

Answer:
Being pre-approved means that you

can shop for a home with the knowledge of exactly how much money you can borrow. By being pre-approved, you’ll be able to show real estate agents and sellers that you have the financing you need to purchase a home.

When you’re able to show sellers that you’ve secured financing, it can make your offer on a home more attractive as a buyer. In fact, it can give you an advantage over buyers who aren’t pre-approved for financing – and don’t really know how much they can borrow to purchase a home. If you haven’t been pre-approved, and you make an offer to purchase a home, you may find out later that you can’t qualify for the loan. Your loan officer should be able to provide you with a pre-approval letter to give to your real estate agent.

By being pre-approved, you can save yourself a lot of time and aggravation when searching for your dream home.