When is it most beneficial for a borrower to request a "pre-approval"?

Requesting a "pre-approval" before making an offer on a property is particularly advantageous for a borrower. A pre-approval provides a written commitment from a lender regarding the amount they are willing to lend, based on an evaluation of the borrower’s financial situation, including credit history, income, and debt levels. This offers several benefits:

1. Strengthened Position: When making an offer on a property, having a pre-approval signals to sellers that the buyer is serious and financially capable of closing the deal. This can give the borrower a competitive edge, especially in a competitive housing market.

2. Budget Clarity: Pre-approval helps borrowers understand exactly how much they can afford to spend. Knowing their budget can streamline the home search process and prevent potential disappointment over properties that are outside their financial reach.

3. Faster Closing: The process of underwriting is largely completed at the pre-approval stage, meaning the actual closing process can be expedited once an offer is accepted. Sellers often prefer deals backed by pre-approved buyers because it often indicates a higher likelihood of successful financing.

In contrast, making a request for pre-approval after finding a suitable home could leave the borrower at a disadvantage, as they may face competition