Pro Tip from Kip: The Importance of Getting PreApproved

So you're ready to start your home search: fantastic! This can be an exciting adventure for new home buyers, but before you head off to search for that perfect home there's one thing you NEED to do. Get Pre-Approved!

Preapproval means working with a Mortgage Broker or Bank to look at your income and overall financial picture, to determine how much money you would qualify to borrow in a mortgage. Essentially, a pre-approval is a promise from a bank to loan you a certain amount of money on a future mortgage.
 
In today's video Kip walks us through the three main reasons to get preapproved before you fall in love with a home. 

1. To Determine your budget: A preapproval will give you an idea of the maximum amount you can spend on a home, as well as what your monthly mortgage payments will be. This will help you target your search to homes you can afford to offer on when you find the right one.

2. To Hold your Rate: Most lenders will allow you to 'lock in' your morrtgage interest rate for 90 days. That means that once you're pre-qualified, even if interest rates go up in the next 3 months, you'll be able to get the lower rate you first qualified with. And if rates go down, the lender still gives you the lower rate. It's a win-win!

3. To Give a Leg-Up in Competing Offers: In the current sellers' market here in Nova Scotia, we're seeing lots of competing offers on properties. Being able to include a pre-approval letter showing you'll be all set for financing can give your offer a competative edge over other offers, and hopefully put you ahead of the pack.

Bonus Tip: We strongly recommend you work with a Mortgage Broker, rather than going to your bank for a prequalification. A broker will shop around multiple lenders for you, meaning you get the best rate and conditions for your individual needs, rather than the 'one-stop-shop' of a bank. Need a broker? Give Kip a call and he'd be happy to help you out!