Whether searching for a home, a car, or a personal loan to help you through hard times, finding the best financing option for your needs is the first step. A home may be one of the largest purchases you ever make, so ensuring that you have the finances secured for the purchase is important. The reason for this is that securing your financing before you begin shopping around will help you know exactly what you can afford, and will prevent you from being in a situation where you are facing less-than-ideal financing terms as a result of needing a speedy offer.
Most home buyers know exactly what they can afford before they even set up an appointment with a Central Florida realtor. They know an estimate of what their monthly payment will be, what their interest rate will be, and what funding they need to come up with at closing or for a down payment. With all of these factors out of the equation, it becomes possible to focus on finding the right home for your needs.
This process of securing your financing before you are ready to buy is called pre-qualification and pre-approval. Pre-qualification means that you’ve ensured that you qualify for a certain loan, and should you apply you will be ready to work within agreed upon terms. Pre-approval means that you’ve already applied, been accepted, and are simply waiting for the right home to come along so you can make your purchase. The Fred Franks Team with many years of mortgage years experience can assist you throughout the whole process.
There are several benefits to being pre-approved when looking for a home:
1. Many sellers will take offers from pre-approved buyers more seriously, as there is a reduced chance of a bank declining the deal.
2. The pre-approval process allows you to shop loans and interest rates on your own terms, without being under the time pressure of a contract.
Having a pre-approved mortgage puts the power in the buyer’s hands and reduces the amount of uncertainty that often comes with purchasing a new home. Knowing exactly what you can afford ahead of time prevents you from getting into a situation where you fall in love with a home that is out of budget.
For more information about pre-qualification and pre-approval, or to get started finding out what home you can afford, contact us.
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