Unless you’ve been living under a rock, you know that the housing market in Boise is very competitive right now. And, if you’re a buyer, looking in East Boise, real estate inventory is low especially—in the lower-priced homes.
So, how do you ensure you beat the competition on a property and get the one you want when you see it? A first step is to talk with a lender and get yourself pre-approved for a mortgage. Sellers will know that you are serious and ready to go if they receive your offer with a letter of pre-approval. It’s also the best way for you to know how much you can pay for a house.Realtor.com offers the following explanations:
What is mortgage pre-approval, anyway?
Mortgage pre-approval is that step in the process where a lender probes deep into your financial past, checking out your income, debts, credit score, and other factors that help it determine whether or not to give you a home loan—and how much money you stand to get. And that helps you set your sights on the right price range for a home.
Be prepared to offer up a pile of paperwork to earn your pre-approval. In general, the paperwork you’ll need to assemble for your lender includes the following:
- Pay stubs from the past 30 days showing your year-to-date income
- Two years of federal tax returns
- Two years of W2 forms from your employer
- 60 days or a quarterly statement of all of your asset accounts, which include your checking and savings, as well as any investment accounts such as CDs, IRAs, and other stocks or bonds
- Any other current real estate holdings
- Residential history for the past two years, including landlord contact information if you rented
Pre-approval vs. pre-qualification: What’s the difference?
Mortgage pre-qualification entails a basic overview of a borrower’s ability to get a loan. You provide a mortgage lender with information—about your income, assets, debts, and credit—but you don't need to produce any paperwork to back it up. As such, pre-qualification is relatively easy and can be a fast way to get a ballpark figure of what you can afford. But it's by no means a guarantee that you'll actually get approved for the loan when you go to buy a home.
Getting pre-approved, in contrast, is a more in-depth process that involves a lender running a credit check and verifying your income and assets, says Rodriguez. Then an underwriter does a preliminary review of your financial portfolio and, if all goes well, issues a written commitment for financing up to a certain loan amount; this commitment is good for up to 90 or 120 days. So as long as you find your dream house and officially apply for your loan approval in that time period, you're good to go!
When you are ready to buy, talk to your lender and get pre-approved. In today’s real estate market, it is a necessity.
Here’s some more info on the mortgage process:
And, if you need a recommendation for a great lender or if you are considering buying or selling and would like to talk with us about what your options are, give us a call! Templeton Real Estate Group—208.473.2203 or via the web. We offer a free and confidential consultation. And, remember if you choose to list with us, we offer a complimentary staging service that, combined with our marketing expertise, will sell your house for more. You may not need to spend a lot in improvements to sell…staging may be all you need to make your house shine. We are TOP BOISE REAL ESTATE agents who know Boise real estate.
By Bonnie Way Snider, Licenced Realtor® and Blogger
Realtor.com®: https://www.realtor.com/advice/finance/why-mortgage-pre-approval-matters/; https://www.realtor.com/advice/finance/get-a-mortgage-preapproval/