Posted on: 11 May 2020
Getting started on the home-buying process can be exciting and a bit confusing too. Some buyers wonder what they should do first. Many decide to get a real estate agent on board first, but some may prefer to get preapproved before anything else. Read on to find out why it's wise to make getting a real estate agent the second item on your list of things to do when beginning your home search.
Why Get Preapproved First?
- Things have to be done in a certain order when dealing with all types of situations and this one is no different. It makes sense to get your financial plans in order before you do anything else. The numbers you discover will dictate what happens going forward. Here is what doing things in this order will do for you as you search for your home:
- It shows sellers and real estate agents that you are not just a lookie-loo taking up their time. It shows you are about to be very serious about buying a home. Real estate agents are happy to schedule home viewings and take care of the negotiations for you – but they may not be happy about having to do all that work if you don't get approved for a home loan.
- It proves you can follow through on the purchase. It's time-consuming and annoying for real estate agents and frustrating for sellers when a buyer cannot get financing and the deal falls through. Getting preapproved shows that you are far more likely to be approved for a mortgage when the time comes.
- Some real estate agents insist that buyers get preapproved before working with them. It helps screen out those who are not ready to buy. If you are not sure you will be preapproved, you may need more time to work on getting your financial house in order before you try to buy an actual house.
- Getting preapproved can make the home search more efficient and quick. Once you know how much home you can afford, you can focus on other important search parameters like square footage, location, and more.
- Knowing how much you can afford also helps you make wise decisions about how much down payment you need and estimate your closing, property taxes, and homeowners' insurance costs.
There are very few real estate agents that won't work with you and assist you in beginning your home search without a preapproval letter, but it makes better sense to do so. To find out more about how to begin your home search, speak to a friendly real estate agent for guidance.Share