Profile picture for BillyRobinson

Home loan pre approvals?

Are these worth doing before inspecting a property? Site's like these claim to save you time by finding several pre-approved loan amounts but are they worth the paper they are written on? Are these worth doing before inspecting a property?  [site deleted by Zillow moderator. Please see our good Neighbor Policy for posting guidelines]
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November 08 2012 - US
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Profile picture for wetdawgs
Most agents or owners will not allow one to tour properties until after obtaining a pre-approval.   A regular US lender would be fine, there is no need to go to an australian website.



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November 08 2012

I would recommend consideration of a local provider, one you can meet face to face. Numerous clients have been greatly disappointed by vendor over promises and under delivering seemingly more prevalent with out of town providers..Best of Luck.

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November 08 2012
I always require a pre-approval to my buyers.  So many of us think we know our credit, but you'd be surprised what might have creeped into your credit history.  This can even be something that is no fault of your own but might be an error on part of the reporting agencies or fraud.  To be sure you are good to go on purchasing a property I would recommend a pre-approval so you can be sure there are no oddities on your credit report and also to be sure you qualify for the type of home you are looking for.  

The reverse thinking from yours is what happens when you find a home you love only to learn you can't get financing for it?  Then you're not going to be too happy.  As other have said, definitely use a lender local to you though.  Good luck with your search!
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November 09 2012
There is a difference between being pre-qualified and pre-approved.

Pre-Qualification: A mortgage loan pre-qualification is simply an estimate of how much house you can afford and how much money a lender would be willing to loan you. This is based on a conversation between you and the lender without having the lender verify your financials and credit history. The lender would then provide you with a ballpark figure in writing of how much he thinks you could afford to pay for a monthly mortgage.

There is no cost involved and there is no commitment on either side. This estimate is just helpful in helping you figure out if buying a home is a viable option, and if so, what your price range would probably be.

Pre-approval: Getting pre-approved means that you have a tentative commitment from a specific lender for mortgage funding. In this case, you provide a home loan lender with actual documentation of your income, assets and debts. The bank will run a credit check and work to verify all your employment and financial information.

Once you are approved, the lender will give you a letter of commitment, stating how much money her bank is willing to loan you for a home purchase.

It is important to understand, however, that even a pre-approval is not a guarantee that you will be approved for a mortgage loan.  The funding will only be given when the property appraisal, title search, and other verifications check out on the home you have chosen to buy. 

Neither is the pre-approval binding; you can still obtain a mortgage from a different lender. If you do stick with the same company that pre-approved you though, the application process will be much shorter once you find the right house.
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November 13 2012
 
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