Benefits of Mortgage Pre-Approval When Buying in the East Bay

Do you plan to buy a home in the East Bay in the near future? Will you need to use a mortgage loan to help finance your purchase? If so, you would benefit from getting pre-approved by a lender. In this article, you’ll learn what pre-approval is, and how it benefits you as an East Bay home buyer.

Mortgage Pre-Approval Explained

Pre-approval is when a mortgage lender analyzes your financial situation to determine how much they are willing to lend you.

Actually, this process helps determine two things:

1. Whether or not you are qualified for a home loan
2. How much the lender is willing to lend you

It’s common for East Bay home buyers to get pre-approved before shopping for a home, and it makes sense to do so. The idea is to get a general idea what you can afford, and then to shop for a house within that range.

Related: Tips for housing hunting in the East Bay

Later, once you’ve found a suitable home and made an offer to buy it, you would then go back to your lender for a final approval. This is usually how the home-buying process works, when there’s a mortgage loan involved.

How It Benefits You, as an East Bay Home Buyer

The East Bay real estate market is pretty competitive right now. So, as a home buyer, you want to have every advantage you can possibly get. That’s where pre-approval comes in. It makes you more competitive and therefore increases your chance for success.

Being pre-approved for a home loan is sort of like being vetted by a mortgage lender. The lender will review your financial situation (and supporting documents such as bank statements and tax records) to determine if you’re qualified for a loan. Pre-approval does not guarantee the loan will go through. But it does give you a pretty good idea of where you stand.

With a pre-approval letter in hand, you’ll be a more competitive home buyer. Sellers will take you seriously and will be more likely to accept your offer, compared to a buyer who hasn’t been pre-approved. This can give you a much-needed advantage, especially in a competitive real estate market like the Bay Area.

Here’s a full list of pre-approval benefits:

• Getting pre-approved by a mortgage lender can help you identify potential problems that might interfere with your loan (too much debt, a low credit score, etc.). The sooner you can identify these issues, the better. It gives you more time to correct them.
• East Bay real estate agents will be more eager to work with you, if you’ve been “pre-screened” by a lender and have your financing on track.
• Sellers will take you seriously. This is especially important in a hot real estate market where the seller is likely to receive multiple offers from buyers.
• Mortgage pre-approval also helps you narrow down your home search. Once you know how much the lender is willing to offer, you can shop within that price range. This is a sensible approach to house hunting. It prevents you from wasting time and energy.

As you can see, mortgage pre-approval helps you in several ways.

Ready to Get Started?

Bridgepoint Funding has been serving East Bay home buyers for many years. We can help you explore your mortgage options and possibly pre-approve you for a loan. Please contact one of our friendly staff members today to get started, or use our online application form. We look forward to helping you.