Buying A Newly Constructed San Antonio Home - Don't Get Mortgage Pre-Approval

At sanantoniohomequest.com, we believe an educated home buyer is a wise buyer. That's why we have compiled a series of easy to remember essential hints for our home buyer guests. Here's a popular one.
If you might buy a newly constructed San Antonio home, get loan pre-qualified, but not pre-approved.

Why?

Keep this in mind. As a marketing strategy, almost all production home builders offer significant buyer incentives tied to using a select lender and title company. That's because the builder either owns outright, partially owns, or otherwise receives financial benefits from the designated lender and title company. Consequently, if your plan is to buy a new home from a builder and, if you will need a mortgage loan to do so, it is better to get loan pre-qualification but not a loan pre-approval.

Here's the reason why.

You'll have to submit a lot of paperwork and pay for a credit check to get pre-approved for a mortgage loan of any type. Then, if you decide to buy a newly constructed home, in order to get the buyer incentives offered by the builder, you'll have to submit the same paperwork and pay for another credit check to obtain your mortgage loan from the builder's select lender. In essence, you'll double your effort and your credit check costs.

So, what should you do?

If you don't know the maximum loan you can obtain based on your income, credit history, and debt, you might still ask a lender to qualify you. Any lender will qualify you, usually over the telephone or on the Internet. Pre-qualification doesn't involve paying for a credit check. It's essentially an estimate. Lender's do pre-qualifications as a marketing technique, in hopes of establishing a relationship leading eventually to selling you a loan.

Or, you can go to sanantoniohomequest.com and use our mortgage calculators to do the pre-qualification calculations yourself, for many different loan types.

If you have questions, or need advice this, or other realty purchase issues, please call or send an E-mail.

I’m Stephanie Kelley, Accredited Buyer’s Representative (ABR®), Certified Residential Specialist (CRS®), Graduate Realty Institute (GRI ®). I’m a Realtor ® at Keller Williams Legacy, San Antonio. You can visit me at sanantoniohomequest.com, call me at (210) 867-8743 or (210) 863-2661, or E-mail me at swkrealtor@aol.com.