Why You Should Prequalify for a Home Loan Before Starting Your Home Search

Looking for a new home in Frederick, MD can be an exciting time, but there are a few steps you should take before beginning your home search. By getting prequalified for a home loan, you create the foundation for buying a home. It gives shoppers something viable to show realtors and sellers, and helps put shoppers' goals at the top of their lists. Read on to learn more about how to get prequalified, and see how The Deibler Group can help you every step of the way.

What does it mean to be prequalified?

Prequalification is the process of supplying a lending institution information regarding your financial status. The institution will evaluate income, debt, assets and other vitals. With the assessment, the institution will supply the shopper with an estimated mortgage amount. This prequalification can be done within minutes on the Internet or over the telephone.

Why obtaining pre-qualification before starting your home search is important

Starting your home search before knowing what homes you qualify for can set you up for failure, disappointment, and wasted time. It’s important to know your finances first to make the home buying process smoother. More specifically, getting pre-qualified before you go out to look at homes is important for a few reasons:

1.) To make sure that you are looking at homes that you qualify for and can close on

When you begin a home search without a prequalified home loan, you operate on an assumption. The assumption is you believe you know what you can afford to spend on a property. Being prequalified helps you better understand the types of homes you can afford, and can help you to not waste time looking at homes that are out of your price range. With that information, you can shop smarter, as you'll give your realtors a budget to work with. Even before contacting a realtor, you can narrow down the specifics of your search and can better determine where you can afford to live and what kind of home features you can look for.

Being prequalified for a home loan prevents wasted time touring homes, neighborhoods and communities that are all wrong. A price range helps everyone narrow the search, especially with other groundwork prepared by the shopper. In the long term, after you've found a home, the prequalification could promote a shorter period for mortgage approval.

2. To make sure that you’re looking at homes you can qualify for that are within your budget

When you are prequalified and know a maximum amount, you can focus on property pricing as well as other costs associated with real estate transactions. Prequalification can help you plan ahead, better budgeting for everything from utilities to furniture.

Most importantly, being prequalified for a home loan eases all worries associated with financing and provides a sense of control when buying a home. Realtors and sellers will take you seriously, and are more likely to work harder with you to find your perfect home within your price range.

2.) To make sure you’re prepared to close the deal

Today’s low inventory in the housing market and fewer houses for sale means that there are multiple offers on every house. You have to have a pre-qualification in hand, know what your max price is and be prepared, or you could lose out on the home of your dreams!

How to Prequalify for A Home Loan

Being prepared is key when searching for a home, and there are many ways to get a prequalification. It can be done over the phone or through a website in a just a few minutes. Lending institutions will want to compile some personal information about you and your finances, and this information will be used to gauge what you would likely receive when you apply for a mortgage. At The Deibler Group, our team of experienced lenders in Frederick MD guarantees courteous, professional, and respectful treatment, transparency, and prompt communication with all of our customers. Start the preapproval process by calling (240) 422-8536 or fill out our easy contact form today.