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  • Derek Poteat

Get Pre-Approved Before You Start Looking

Real estate agents get emails and calls from prospective customers who want to look at a house or houses, and they tell us what price range they are looking at. Unfortunately, quite often, this prospective buyer has not gotten pre-approval from a bank or lending company. Instead, they are basing their buying power on a current housing payment or an estimate of what they think they can afford. More often than not, these two numbers can be very different.


When you get pre-approved at a bank or lending institution, the lender takes into account all of the factors that determine your borrowing power, not just your income. A lender will evaluate your income to debt ratio and determine what type of payment you can afford, staying within certain ratios. Lenders will also determine what type of loan suits your needs best. If everything goes according to plan, you will leave your lender with a letter of pre-approval for a certain amount. This is not the actual loan process, however, as that begins once you have put an offer on a property.


After getting your pre-approval letter, give your local real estate agent (preferably me) a call and share what you have been qualified for. I will help you find the property you want in the price range you can afford.


Go out and talk with your local lenders and get to know them. The process does seem a little overwhelming at times, which is why you need a good lending professional.


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