When To Pre-Qualify
When Should I Pre-qualify for My Mortgage?
1. Jim just got a new job and is starting to save so that he can buy a home in about a year.
2. Susan has her house on the market and is working with a realtor to find a home to buy.
3. Alex is signing contracts tomorrow to purchase a new home.
Which people should be getting a mortgage pre-qualification if they have not already?
The answer is all of them. We would probably all agree that Susan and Alex should be getting the mortgage process started so that they have a pre-qualification letter to send with their offers and so that they have the mortgage process completed well before their closing date, but why should Jim be getting a pre-qualification?
There are a number of reasons why a person in Jim’ position should be getting a pre-qualification:
- I just took an application from a customer who found a home and wanted a pre-qualification. She wants to close on her mortgage in 30 days. She knew she had spotless credit so she did not think she needed to get pre-qualified. When I ran her credit she was surprised to hear that there were three collection accounts totaling $10,000. They were from people that opened credit in her name fraudulently 5 years ago and she thought it had been cleared up. We are working to get them cleared up before her scheduled closing date, but it is going to put a lot of extra stress on her, even though I am doing as much as I can to help. If they can not be cleared up her rate will be 1.5% higher.
- Speaking with a mortgage professional will educate you and possibly help you realize that you may be able to purchase sooner or that it may be better to wait a little longer. If Jim is saving to put down 5% he may find out that with his exceptional credit he can get an excellent rate now without putting down any money.
- If you speak with a good mortgage professional they will keep in touch with you until you are ready to buy and continue to educate you. The extra information that he or she may come across in that year and send to you could make a huge difference in your satisfaction with the mortgage you select and make your dream house even better.
- If you have credit problems a mortgage professional can show you how to clean them up before you is locking in a rate.
If you are thinking about buying a home in the next year call me on 866-866-0900 ext. 39 so that when you buy the process is as smooth as possible and you get the interest rate you deserve.
