Lake of the Ozarks Real Estate Blog

Buyers should definitely get Pre-Approved for financing for 3 simple reasons.

1. To Save Time.  Even with today's market being a "Buyers Market" it is still to the individuals benefit to get pre-approved for financing.  Many times buyers believe that they are capable of purchasing a home in a certain price range but will not know for certain.  Could you imagine how heart breaking it would be to be touring homes that are priced between $150,000 and $200,000 only to find out after you have located that one house that you really love and want to purchase that you have a problem with your credit score.  Issues with credit scores can take months to resolve and just one or two marks on your credit could mean the difference between getting approved or not approved for financing.  Now you and your Realtor are out the time spent searching for and touring houses.  The seller may also be frustrated if they agreed to a contract only to lose it a few days later when you are not approved for financing.

2.  To Improve Negotiating Power.  As I mentioned above today is definitely a buyers market but in the last 45 days I have written two contracts only to discover that there was a competing offer coming in for the property.  If a property is well priced there is a good chance you are not the only potential buyer considering it.  If you submit an offer and can show that you are already pre-approved for financing and your competitor is not pre-approved your offer could hold more weight for the seller in consideration because there is less risk to them on the potential of losing the contract to non-approval of financing.

3.  Offers on Foreclosures require Pre-approval letter.  In today's market the foreclosures are very common and there are a lot of good deals being found in the purchase of a foreclosure.  Foreclosure properties require a letter of pre-approval be submitted along with your offer to purchase.  If you do not have a letter of pre-approval to submit with the offer the bank will kick back your offer and will not consider it. 

At John Farrell Real Estate our Agents work with local lenders on a daily basis and we are here to assist you.  If you are considering purchasing a home and would like to visit with us about getting pre-approved and perhaps receive some recommendations of good lenders please contact us at your convenience.  We can be reached at 573-348-2181.