VA LOAN CAPTAIN BLOG & Learning Center

Preapprovals: What to Look For

By: Grant Moon 02/05/15 05:44 pm

Thinking of selling your home soon? Getting your property ready to show when the buyers start coming out this spring? If so, it’s time to start preparing your property to put it I the best light possible because you’ll be competing against other properties and you’ll also soon be reviewing offers. Your agent will help you with the best possible price for the time you want to take to sell the home and as soon as you start taking those offers make sure there is another letter attached, otherwise the offer may be D.O.A.

You remember when you bought this house, right? It might have been some time ago or perhaps rather recent but I’m sure you do remember when you made the offer. Recall that along with the sales contract hoping the seller will agree, the seller also asked if you’ve already applied for a mortgage and have your financing lined up. Of course you did, you had your preapproval letter for a VA loan from your lender. But did you pay much attention to it or did you just have the agent forward it along with your offer. If you didn’t look closely, you won’t remember exactly what it said. You need to remember, because you’ll soon be reviewing preapproval letters yourself. What should you look for?

You need to specifically look for the word “Preapproved” and not “Prequalified.” Someone holding a letter with “prequalification” in the text may not have had their credit report reviewed or income verified because a prequalification doesn’t require very much due diligence. A preapproval is issued only after the review of a credit report along with income and asset verification. From the preapproving lender’s perspective, all that’s needed is a property address—yours.

You’ll be expected to provide a preapproval letter when you shop for your next home, just make sure you know what sellers want to see. You’ll want to see the very same.

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