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 How important is a pre-approval mortgage?If you are planning to buy a house this year in Port St. Lucie or St. Lucie West, Florida it is imperative to get a pre-approved mortgage before you start house hunting. The purpose of a mortgage pre-approval is to confirm in writing, in advance, the maximum amount of money on which you can rely for mortgage purposes and to get verification of the mortgage rate you will pay. This will help you be realistic when you are searching to buy a property and negotiating a purchase. When you apply for a pre-approval it is much the same as applying for a mortgage. You must show your total income, and sources, provide information on other loan payments and allow a credit check. After going through your financial information, the lender will pre-approve you for a specific mortgage amount for a set period of time. For example, you may be approved for a $300,000 mortgage with an interest rate guaranteed for 30 to 90 days, depending on the stability of market interest rates. If the mortgage interest rate drops before the lender advances the funds for a mortgage, you are given the lower rate. If the rates rise, you are given the rate at the time you had the mortgage pre-approved. A pre-approval also allows you to narrow the search for a hous to the exact amount of mortgage you can expect to have. There is a further advantage of working on the mortgage details before you have even seen a home you want to buy. When discussing the pre-approval you can get advice on the various types of mortgages and payment options and negotiate the best possible deal for your situation. For instance, you can confirm the amount of down payment needed, whether you want a 'closed' mortgage or a more flexible 'open' mortgage, the amortization term and the schedule of payments. Finalizing all these particulars before you face the pressure of a home buying closing date will give you the tius to clearly understand all of your mortgage options. There is always the condition, of course, that the lender must appraise the actual property being purchased before the funding is approved. This provides the lender with the opportunity to make sure the security is suitable. |
