Buying a house without mortgage is not possible in today’s real estate sector. You might be having big money but there is always some shortage of funds with the prices of properties rising every day. This is what the mortgage loan is for. But every so often the entire process of loan sanction is so time consuming that by the time you really get the money in your hand your dream house that you planned to buy is already sold.
You can easily stay away from any circumstances like this by getting pre-qualified for the loan sanction. It is a very easy process and will always ensure that you never lose any deal due to lack of finance. Generally one has to run from one bank to another to get the mortgage loan sanction while wasting the precious time. Also there are lots of formalities involved in the entire procedure which will again take time. During this you may lose the house to another buyer.
Getting pre-qualified to purchase of a property is very easy and you do not even have to go to the bank. You can do it by on the phone from home or even do it online. All you require is speak to a knowledgeable loan officer. They will inquire about your financial position, your income and your previous loans. Based on information you gave them they will tell you the fairly accurate amount that you can get as mortgage loan from the bank.
They will also want to know about any short sale or foreclosure property dealings in the past. Your credit report will also be accessed. They will mostly check your repay options and then declare the fairly accurate amount that you can get. Most of the banks give you oral affirmation of the same after which you can start the process of applying for loan. But this will help you only to make a rough estimation of your budget for purchasing property.
Some of the bank even give you pre-qualified letter with which you will be able to close deals faster and also along with other papers it will help in speed processing of the loan.
But you must bear in mind that the pre-qualified letter is unlike pre-approval letter. While pre-qualified letter is mostly based on verbal information given by you the pre-approval letter is based on formalities like your salary slips, credit report and tax records. Pre-qualified letter you have to apply for the loan while in pre-approval letter the loan is already approved and you are just waiting for the fund release.
Getting pre-qualified is an advantage for the first time buyers because they now know the quantity they can invest in the property. Also for every buyer this is a great help as they can easily save time on any purchase. Moreover here you must keep in mind that getting pre-qualified is the initial step towards loan approval. Once you get pre-approved it is going to influence your credit report.