• Pre-Approval Letters Are Necessary When Buying A Home In Michigan

  • A Pre-Approval Letter Is Vital When Making An Offer On A New Home

    In today’s purchase market, the Pre-Approval letter is an important piece to have when looking for homes. This process helps you prevent the swing and miss at buying the house of your dreams.

    A Pre-Approval Letter states your qualifications as a borrower to show you can obtain financing for the home. More importantly, it gives clear indication to the seller that you truely can afford the offer you are making on the home and better clarifies your down payment and seller concession options. It is important to understand that in this marketplace is it impossible to get an offer accepted without having this letter.

    Why Getting Pre-Approved When Buying A Home in Michigan is Important

    If you are looking to buy a home in Michigan, we cannot stress enough how getting a Pre-Approval letter is absolutely vital if you plan to obtain financing for the home. For the 2013 buying season in Michigan, it could not be more competitive. Redfin recently released numbers showing that in 2013 the percent of homes on the market who received multiple offers reached a high of 76%, up from 46% in 2011.

    Here is an example of just how competitive the Michigan housing market really is.One of our real estate partners recently listed an 1100 square foot home for sale in Livonia, Michigan for $140,000. On Sunday’s 2 hour open house, he saw over 120 people come through to look at the home. By Monday, the home was in a bidding war with nearly 20 offers placed on the home pushing it well above asking price. That is not out of the ordinary for Michigan these days, it is a war zone out there!

  • Imagine you were looking to buy the property listed above. If the listing agent receives 20 offers for the home, and yours does not have a pre-approval letter showing your true mortgage qualifications, it will be simply tossed aside. Considering how quickly this home was shown and bid on, if you find yourself sitting there Sunday or early Monday morning in need of a pre-approval letter, this house could be snagged up before you even get a chance to act! To have the best chance of getting the home you want in Michigan, make sure to get pre-approved first and proactively work with your Realtor and Mortgage Lender so you can put the best offer out there you can.

    How to Get Pre Approved To Buy A Home

    Now that you know just how important having Pre-Approval letter is, it’s time to get one yourself. Luckily this is a very fast and easy process and you can even get Pre-Approval letters the same day!

    First, find a mortgage lender you trust, recommended by a friend or family member is a great place to start. Note: You do not need to obtain a mortgage with the company you got Pre-Approved with, once your offer is accepted you may work with whoever you wish. Then make sure to provide the following documentation:

    • Basic Information – Full Name, Current Address, and Social Security Number (to run credit report)
    • Two recent pay stubs showing year-to-date information.
    • W2′s for the past two years (2010 and 2011).
    • Your recent checking and/or savings account statements.
    • Your recent retirement account statements (401K, IRA, etc.).
    • Make sure to bring all pages for these documents, not just page 1!

    If you’d like to get your pre-approval with First Commerce Financial, the above information is all you need to get it done fast and easy! Give us a call at 248-912-1000 to let us know how much home you are looking to buy and see if you qualify! You then can email your documents to info@firstcommercefinancial.com, fax them to 248-912-1001, or stop in and see us!