A pre-approval letter is a document obtained from your lender specifying the maximum dollar amount you can spend on a house and under which terms you would qualify for that amount based on your financial situation. How important is it to have a pre-approval letter from your lender in-hand before looking at properties? Quite simply, it can mean either snagging the house of your dreams, or watching the keys fall into the hands of your competition.

First, most sellers will mandate a pre-approval letter to be submitted with the offer. Second, sellers place less significance on an offer without a pre-approval letter since there is no support to back the buyer’s claims that they are good for the money.

Sellers see these offers as risky as it would mean taking the home off the market the buyer attempts to become qualified to purchase it. Submitting your offer without a pre-approval letter, even if not mandatory, hurts your chances of getting your offer accepted.

Many buyers apply for a loan and obtain loan approval online before meeting with an agent and begin looking at homes for sale. If this is what you have already done, great! If not, below are a few more reasons why you should get to work obtaining your pre-approval letter.


3 Key Outcomes of the Pre-Approval Process 

  • Know exactly how much you can afford, eliminating wasted time and inaccurate expectations by looking at homes that are outside your price range.
  • Get the best financing by communicating with your lender to help get the lowest interest rate and down payment to obtain the most house for your money.
  • Make a stronger offer. The power of immediate action allows you to beat out other buyers who are not pre-approved, and puts you in a position to negotiate the lowest price and best terms.


We advise all of our clients to speak with a lender to go through the pre-approval process in order to avoid hiccups in the transaction. If you currently do not have a lender, we can refer you to lenders we have vetted out and consider part of our team of experts.

For more information on this and other real estate related questions, contact us today.

The Kink Team