Key First Step Many Home Buyers Miss

Q: My boyfriend and I want to buy a home. We are trying to decide between a ranch and a colonial. What do you think? Gail, Vauxhall, NJ

A: The most critical first step in purchasing a house is getting pre-approved for a mortgage loan. Here’s why: you have to find out how much money you may borrow before you can shop for a home in a smart, effective way. A mortgage pre-approval will help refine your home search so you don’t waste time looking at homes outside your mortgage approved spending budget. Also, a mortgage pre-approval will show how much cash you will need for a down payment for a mortgage as well as closing costs and a mortgage pre-approval will shed light on whether you need time to save more money, sell assets you own or accept mortgage gift funds from family in order to close on your home. Finally, having been pre-approved for a mortgage shows that you are a serious buyer to a home seller and to their realtor which is important because most home sellers require a mortgage pre-approval before they will agree to set up a showing on their house to potential buyers. Thanks for your question, Gail.

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