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Pre Approval

Colorado Springs Real Estate Buyers Guide – Pre Approval

pre approvalWhen looking for a home, the absolute first thing a buyer must figure out how much they can afford. (Note: I say how much you can afford, not how much you qualify for…a big difference).  They way you do that is by getting a pre approval from a lender. Buying what you can qualify for vs. what you can afford can make you house poor. Not a fun situation to be in (I’ve been there). When you have a pre-approval letter from a lender, it also increases your leverage in the negotiation process because the seller knows you are a serious buyer.

Contact a mortgage broker and get pre approved. A mortgage broker will look at credit scores, current debts and income to determine your price range.

 

Colorado Springs Real Estate Advice:

CanYouAffordThe easiest way to stay within your budget is to tell a mortgage broker what your maximum comfortable monthly payment would be and how much you intend to put down. They can then “reverse engineer” what your max purchase amount would be based on that payment.

For detailed discussion about different mortgage types available you can go here.

When you decide you want to buy a home, Do NOT BUY ANYTHING on credit until you close on your new home! NOTHING! NADA! ZILCH! I have seen it happen before where a client will start the house hunting process and then buy a car or furniture or a TV and use “6 Months same as cash” or some other financing option and mess up their ability to purchase. If you are already under contract and this happens, you will be in breach of contract and lose your earnest money! If you absolutely must buy something, check with your lender first.

Mortgage Resources: Find A Lender | Mortgage Types

If there is something I haven’t covered or you have questions, please feel free to contact me.

Pre Approval | Prioritize Wants/Needs | Where To LookResale | Contract TipsContract To Close

Buying A House | How To Buy A House In Colorado Springs