Why Get Pre-Approved?
Because therre are 3 people who will benefit from your pre-approval: You, your Realtor, and the Seller from whom you eventually buy a home!
You: The mortgage pre-approval step is a relatively simple one, but it is an important one. It begins the process of formally applying for a mortgage, and it gives everyone involved--especially you--a clear sense of teh direction they should be headed.
Your Realtor: By knowing what your financial parameters are, your Realtor can spend more time looking for houses that "fit" and less time pursuing dead ends. No matter how much you might want a 4000 square foot home for $275,000, if your qualifications say $125,000, your qualifications say $125,000.
The Seller: Want to strengthen your bargaining position? Get pre-approved! Want your offer to stand out in a case of multiple offers for the same house? Get pre-approved! Look at it from the seller's perspective. If you had 2 offers on the table for your house, one from a fully pre-approved buyer and the other from an "I'll get around to that soon" buyer--to which offer would you devote the most attention? Even if the pre-approved buyer's offer was $1,000 less, would you take the chance on the buyer that perhaps may not be qualified? When it comes to a seller evaluating offers, "a bird in the hand..." definitely applies.
