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Why You Should Get Preapproved For A Mortgage Before House Hunting

3-Minute Read
Published on December 16, 2020
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If you’re in the market to purchase a home, you may realize the inventory of available houses is limited and competition is stiff. If you’re looking to buy an already existing home, you’re in for a challenge, because it’s definitely a seller's market.

The National Association of REALTORS® releases a monthly report on the number of existing home sales across the country. Homes are only on the market for an average of 57.5 days, according to the latest data released for November 2020.

In the market for new homes, there are only 3.6 months’ worth of housing inventory available. For context, a market is generally considered in balance if the amount of inventory available is 6 months’ worth.

Although competition is fierce, one of the best things to do is make sure your financing is lined up by getting preapproved before you even start shopping for a home.

Let’s discuss the advantages of getting your mortgage approval before you go shopping for a home.

Advantages Of Getting A Mortgage Preapproval Upfront

There are several benefits to getting preapproved for your mortgage financing right up front. Let’s run through them.

Get A Showing Faster

In some markets, real estate agents are refusing to show homes to potential buyers who do not have an updated preapproval letter. Getting this step out of the way before you start house hunting will ensure you’re able to jump on any house that catches your eye.

Make Your Offer Confidently

If you’re looking to make an offer on a home, having a preapproval will help you understand whether you’ll be able to afford the monthly payments. There’s no sense guessing.

Comfort The Seller As A Low-Risk Buyer

Getting a mortgage preapproval before looking for homes doesn’t just give you confidence. Knowing your qualifications have been checked in advance also gives a seller comfort when dealing with you. They know your offer isn’t likely to fall through if everything has been verified by an underwriting team. In a seller’s market, some sellers may not waste their time with buyers who haven’t been preapproved.

Making sure the deal goes through is one reason that in the past a seller may have preferred to take a cash offer. With the backing of a preapproval, you and the seller will know that you have the financial credentials to back up the offer you’re making.

Apply Online with Rocket Mortgage

Get approved with Rocket Mortgage® by Quicken Loans – and do it all online. You can get a real, customizable mortgage solution based on your unique financial situation.

Apply Online

Advantages Of A Verified Approval

The mortgage preapproval process can be even easier with a Verified Approvalwith Rocket Mortgage®. When Rocket Mortgage® gives you a Verified Approval, we not only pull your credit to get an idea of your debts – we also verify your income and assets through documents like pay stubs, tax returns, W-2s and bank statements. This analysis is completed upfront by our team.

Within 24 hours of receiving all your documentation, you’ll be given a Verified Approval Letter that will give you and the seller the absolute confidence that you can afford the offer you’re making.

Rocket Mortgage® is confident in our preapproval process so we guarantee it.

The Bottom Line

You should get preapproved before looking for a house, but only if you are serious about purchasing within the next 3 months. Otherwise, you risk hurting your credit score if you decide to pause on the home buying process.

You can get started with our Power Buying Process online through Rocket Mortgage® by Quicken Loans®. If you would rather talk through your options with someone, one of our Home Loan Experts would be happy to help at (800) 785-4788.

1Participation in the Verified Approval program is based on an underwriter’s comprehensive analysis of your credit, income, employment status, debt, property, insurance, appraisal and a satisfactory title report/search. If new information materially changes the underwriting decision resulting in a denial of your credit request, if the loan fails to close for a reason outside of Rocket Mortgage®’s control or if you no longer want to proceed with the loan, your participation in the program will be discontinued. If your eligibility in the program does not change and your mortgage loan does not close, you will receive $1,000. This offer does not apply to new purchase loans submitted to Rocket Mortgage® through a mortgage broker. Additional conditions or exclusions may apply.

Apply for a Mortgage with Quicken Loans®

Call our Home Loans Experts at (800) 251-9080 to begin your mortgage application, or apply online to review your loan options.

Start Your Application

See What You Qualify For