Looking To Buy A Home? Get Pre-Approved. Here’s Why.

Recently started your journey to homeownership? If so, chances are you’ve stumbled across the term “pre-approval” once…or a hundred times. But what is it, and why is it so important? Let’s dive into this essential step in the homebuying process and chat about what it means for you and your road to home. 

What Is Pre-Approval?

Before you can start house hunting in earnest, your lender needs to assess your financial situation to determine how much they’re willing to lend you for the purchase of your new home. These assessments will cover your W-2s, tax returns, credit score, bank statements, and other financial documents. Once they’re through combing through those, they’ll provide you with a pre-approval letter, outlining the maximum loan amount they’re willing to offer you.

That last bit is important: the maximum loan amount. Regardless of what your pre-approval letter comes out to, you should only ever borrow an amount you’re comfortable repaying. This isn’t about maxing out your pre-approval letter, it’s about creating a guidepost for your financial boundaries before you start house hunting in earnest. 

Why Pre-Approval Matters in 2024

Though more homes are being listed for sale, demand is still far outweighing supply, especially in booming areas like my area of expertise in Horizon West, Florida. We don’t call it “Disney’s Backyard” without reason! Lots of folks want to live here, and prospective buyers will want the odds stacked in their favor if it comes down to a multi-offer situation. 

Here’s the thing: in  an area this popular, the desire to move into Disney’s Backyard might outweigh one’s ability to compete in the hectic market. Pre-approval shows sellers (and Realtors) that you’re serious about moving, and you’ve got the funds to back it up. As a Realtor, pre-approval also gives me a sense of what kinds of homes we’ll be looking for based on your preferences and buying power. It’s for this reason that many Realtors in my area require that prospective clients secure a pre-approval letter before they will sign on to work together. 

Get Started On Your Homebuying Journey   

Pre-approval doesn’t have to be a daunting process. I know it can seem stressful to put your buying power in the hands of the lending company, but they’re here to help you! And with that information, you set yourself apart from the crowd with Realtors and sellers alike who know you mean business. 
Ready to start your journey to homeownership? Call or text me on my cell at 407-848-8042, email me at amy@heartandhomeorlando.com, or submit a wishlist right here on my website to get started!