I am looking to purchase a home and want to make a bid on a foreclosure..possibly a short sale. Do I need to be pre-approved to purchase or can I pre-qualify after they accept my offer? The agent said they want me to get pre-qualified with the lender that owns the property.
- Greetings, Before even going shopping for any house, get pre-APPROVED by a DIRECT lender unless you are not financing (all cash buyer)! Hope this helps!
If you plan to finance your purchase, you should be pre-qualified. That rule of thumb counts for traditional, short or foreclosure sales. If you plan to pay cash, you should have proof that you have the funds available. The reason to get the pre-qual first is to present the strongest possible offer from a qualified buyer. All other terms equal, a pre-qualified buyer will more often than not have their offer chosen by a seller rather than a buyer who has not yet accomplished this step yet. The seller can request that you pre-qualify with their lender of choice, but ultimately who you decide to use for your mortgage is your decision.
- There is a lot of competition for Buyers in today's market. If the 'shoe was on the other foot" so to speak, wouldn't you want cash (or as good a cash) for your item you have for sale? Certainly Sellers want to sell their home, not have it for sale. So, if you are pre-approved (not pre-qualified) you present yourself as an educated Buyer who understands the business of Real Estate sales and someone who can complete the purchase. Your chances of getting your offer accepted will be greatly improved. Good Luck!
You don’t HAVE to be pre-approved to write an offer on anything, but why wouldn’t you? Wouldn’t you want to know if you’re going to get a loan on the home that you’re now starting to see yourself in? AND…The market has been such that for years now any listing agent will insist on it before moving very far forward without pre-approval.