Getting Prequalified For A Mortgage Loan Can Speed Up The House Buying Process

Having a prequalified mortgage loan can be an advantage to all concerned - you, your real estate agent (if you use one), and the home seller you are buying the property from. Preapproval means that you are preapproved to get a mortgage loan before you begin searching for a property to purchase.

In determining the level to which you can borrow up to, a mortgage lender will consider many variables such as: your income, credit history, your debt obligations. A mortgage loan lender is likely to consider special mortgage programs and variations in qualifying guidelines between different mortgage types.

The only sure way of knowing how much you can borrow is to go through the mortgage loan prequalification process.

Mortgage prequalification is not difficult, but if you are not a cash buyer,it is an essential part of the whole home buying process.

Mortgage prequalification sets the wheels in motion and is the first step in formally applying for a mortgage loan. It lets you (the home buyer) know what is and isn't possible.

A mortgage prequalification can also help a real estate agent to better meet your needs. A real estate agent can waste a lot of time searching for properties that are out of your financial reach. By knowing what your financial boundaries are, your real estate agent can concentrate on finding properties that fit within your budget. This will save your real estate time and it will save you time by not having to inspect properties that you can't possibly afford to buy.
Having a mortgage prequalification can improve your negotiating position with the seller of the property.

If the seller gets two similar offers to buy the property, he or she is likely to select the one that is from a fully prequalified buyer as opposed to one that is subject to the buyer applying for finance. The seller might even accept a lower offer from a prequalified buyer rather than take the chance the other buyer can't obtain a mortgage loan.