The Power Of Pre-Approval

What do you think happened to Fast Freddie and Thorough Theodore?

Fast Freddie and Thorough Theodore both closed right on time

Incorrect

Fast Freddie closed on time, but Thorough Theodor closed late

Incorrect

Fast Freddie's mortgage loan fell through, and Thorough Theodore closed right on time

Correct!

Turns out that Freddy’s pre-qualification had a lot of PRE, very little QUALIFICATION, and a complete absence of APPROVAL.

A pre-qualification can be done quickly, but without verified information, it may not be worth the paper it’s printed on. A pre-approval is much more thorough and accurate. Once you have one of these in hand, your credit and income are well known. All you’ll probably need to do next is find the right house.

In other words, a little extra spent up front, can actually save you lots of time in the end.

Both mortgage loans fell through. Poor Freddie and Theodore!

Incorrect

Recently, the housing market has become more competitive, with bidding wars occurring in many transactions. Plus, mortgage guidelines have been tightened. Documentation requirements have been expanded and are being followed more closely.

A pre-approval gets you through the much of the loan process and uncovers potential pitfalls long before you become obligated by a contract to purchase.

What advantages will I have once pre-approved?
You’ll be certain about the price range that’s best for you. You’ll know how much cash you’ll need to close, and you’ll know your maximum monthly payment. Understanding your limits will help you negotiate with confidence.

Plus, since sellers like a sure thing, you’ll have an advantage over buyers who may not have been through the process.

How long is the pre-approval valid?
Your pre-approval is typically good for the “shelf life” of the documents used. These will include a credit report, pay stubs, bank statements, W2s, tax returns, etc.

The usable life of these documents will vary, yet it’s usually safe to say that your approval is good for up to three or four months. During this time, it pays to keep all important financial documents so they’re readily available for future updates.

What if I change my mind?
That’s perfectly fine. There’s no obligation to purchase a home or use a particular loan program once you’ve been pre-approved.

In fact, pre-approval simply helps to assure you know exactly what’s involved, that you are comfortable in a particular price range, and that you are truly ready to make your move.

The process of purchasing a home is easier when you have financing in place before you make an offer. We’re here to help get you started, and it’s never too early to do exactly that.

Next Step

Get Pre-Approved

Getting pre-approved is the first step in buying a home. By getting pre-approved, you can:

Focus on your home search, knowing your financing is in Poli’s expert hands.
Find out exactly what home price you qualify for and shop with comfort
Improve your chances for homebuying success, since sellers heavily favor offers with pre-approvals from reputable lenders.

Wondering What Your Rate Could Be?

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Poli Mortgage Group is a Division of radius financial group inc. Corporate NMLS #1846. radius financial group inc. is an Equal Housing Lender. Poli Mortgage Group is licensed in CT, FL, ME, MA, NH. For more licensing information please visit: https://polimortgage.com/licenses/ or by visiting www.nmlsconsumeraccess.org. Some products and services may not be available in all states. Credit and collateral are subject to approval. Terms and conditions apply. Programs rates, terms and conditions are subject to change and are subject to borrower qualification. This is not a commitment to lend. The content in this website has not been approved, reviewed, sponsored or endorsed by any department or government agency.

* This radius Pre-Approval/Credit Commitment Promise Contract ("Promise") is made and entered into, as of the date of the last signature below, by and between radius financial group inc. ("radius" or "Lender"), and the below-named Buyer and Seller. In consideration of Seller's reliance on this Promise in entering into a real estate purchase transaction with Buyer, the Parties agree as follows:

PROMISE TO SELLER. In the event that a Seller is induced to accept an offer from, and enter into a purchase and sale agreement with, a radius borrower on account of this Promise in connection either with (a) a radius Pre-Approval or (b) a radius Credit Commitment and the Buyer is unable to close on such Eligible Transaction due to a mistake made by radius (with accurate and up-to-date information) on such Pre-Approval/Credit Commitment (a "Bad Pre-Approval"), then radius shall pay Seller ten thousand dollars ($10,000), subject to the terms and conditions herein as Seller's sole remedy.

PROMISE TO BUYER. In the event that radius issues a Bad Pre-Approval to Buyer on an Eligible Transaction, radius will reimburse Buyer reliance expenses up to one thousand dollars ($1,000) for a home inspection, appraisal, or legal expenses actually paid out-of-pocket by Buyer, subject to the terms and conditions herein. This payment shall be Buyer's sole remedy.

ELIGIBLE TRANSACTION. For purposes of this Promise, an "Eligible Transaction" is a purchase money mortgage transaction for a primary residence (made on or after April 1, 2018) (not made to a radius employee or immediate family member), provided that the loan is a Conventional, USDA, VA, or FHA loan product for either (i) an existing home resale or (ii) a newly constructed home that is to be delivered and closed within ninety (90) days of the P&S.

CONDITIONS. The applicable radius Pre-Approval must not have expired prior to the date of the P&S. Offers/P&Ss cancelled due to home inspection issues or title defects are not covered under this Promise, and this Promise is void if a Bad PreApproval is the result of: (i) a change in Buyer's financial position, (ii) property specific requirements or expenses (e.g. homeowner's association dues/fees, flood insurance, or property taxes), or (iii) loan product availability or underwriting requirements, or third-party actions outside of radius' control.

FUNDS DISBURSEMENT. Any funds due and payable under this Promise will be paid if requested by Buyer or Seller in writing within 90 days of the date of an applicable Adverse Action Notice and accompanied by a fully-executed copy of this Promise. Any payments made under this Promise will be reported to the Internal Revenue Service by radius on a Form 1099-MISC or as otherwise required by then-applicable law. Please consult your tax advisor for any tax implications.