Let me first note that all states or market areas do not have the same practices when it comes to submitting an offer on a property.
In our market area, Chester County, Delaware County, Montgomery County to name a few in Pennsylvania, it is not a requirement but an additional document that shows the seller that you are indeed able to purchase the property at the price you have stated and strengthens your offer. I vigorously recommend providing the pre-approval.
The more financial information you provide the seller with your original offer, the more likely they will see you as a qualified and serious buyer. In the case of multiple offers, an offer with compelling financial information is more likely to be of top consideration.
Remember, the Seller's real estate agent is there to provide their client with their extensive experience in making sure that the deal gets to the settlement table. When the seller’s agent can present the offer with the pre-approval letter, an earnest check and a buyer’s financial statement, the seller’s agent has more confidence that the buyer’s agent is thorough and has brought a buyer that is qualified to purchase the home.
The pre-approval letter is also important to the agent that represents you as a client. It’s important that your agent know your financial situation to help you find a home that you can is within your ability. A pre-approval letter lets the buyer’s agent know that you have talked with a mortgage lender (if you haven’t your agent can recommend one), you know your limits and are ready to move forward. You don’t want to go see homes you cannot afford and fall in love with only to find out it’s out of your ability to purchase it!
Typically, the final pre-approval letter is in the amount of your offer, and not necessarily the top of your price range.
If you put yourself in the seller’s shoes, an offer without anything supporting the qualification of the potential buyer to purchase would be more of a risk, wouldn’t you agree?
It’s an easy step to take to strengthen your position in the marketplace. So, get it done prior to beginning your search for the home of your dreams!
Attached is a link to a checklist of items the lender may require:
Table of Contents
- Part 1: Consumer Notice-9/14/17
- Part 2: Buyer's Agency Contract-9/21/17
- Part 3: Buyer's Agent Commitment to Client-10/10/17
- Part 4: Mortgage Pre-Approval, Why is it Essential?-12/17
- Part 5: The Seller's Disclosure-Coming Soon
- Part 6: Deposit Money in a Real Estate Transaction-Coming Soon
- Part 7: The Escalation Clause, To Use or Not to Use?-Coming Soon
- Part 8: The Anti-Fraud Disclosure-Coming Soon
- Part 9: The Sales Agreement, What Is In It?-Coming Soon