Do you want to buy a new home? Have you just considered making an offer on a listing? If so, it might be time for you to take the next step and become a pre-approved home buyer. Here we will tell you about the pre approval home loan and its advantage.
Pre approval home loan—
This is a facility offered by banks and financial institutions whereby potential buyers interested in buying a house can make an application for pre-approval of a loan even before they zero in on any property. Click here to read about Axis bank home loan.
Advantages of pre approval home loan—
- Nowadays there is a competitive housing market; it is not special for a seller to receive multiple offers on their home. If you having a pre approval home loan in your hand could be the difference you to buying the home of your dreams. A pre-approved loan will make it clear to the seller that you are serious buyer and also state the fact that you have the financial means to close the transaction. Thus he will be eager to offer you a discount or some additional benefits so that the deal is done.
- The biggest advantage of a pre approval home loan is that it gives you a clear idea of how much you can borrow from a bank. This allows you to plan and arrange the funds from other sources like withdrawing from savings, borrowing from family/friends, selling shares and withdrawing bank deposits. This will avoid you from straying houses bigger than your budget.
- Based on financial reports and credit record of the borrower, banks offer pre-approved loans. Not like standard home loans, banks do not evaluate both financial papers as well as property papers at the time of pre approval. Only financial documents are valued at this stage which makes the processing much faster. At the time of disbursal, provided there have been no changes in the borrower’s income, only property documents will be verified by the bank. Thus the processing time involved at the time of disbursal would also reduce.
- Many times, banks offer a discount on the interest rate applicable for pre approval home loans. Although not significant, these discounts are genuine. Considering the amount of most home loans is usually large, even a small discount can save the interest cost significantly.
- Since the agent will earn commission on the deal, he will put in extra efforts as he knows you are a genuine buyer.
we hope this information benefits you for getting your dream home and home loan.
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