21 April 2025

Let’s Talk Mortgage Pre-Approval Letters!

Let’s be real – submitting an offer without a strong and well-documented Pre-Approval Letter is like trying to buy a house with Monopoly money. In today’s complex and fast-moving real estate market, it’s more important than ever for buyers to prove they’re serious and financially ready to buy.

In the age of technology there are plenty of online-only mortgage shops that will issue a Pre-Approval Letter without even reviewing a credit report or a client’s financials. I can’t stress enough after rescuing countless transactions from these types of lenders over the years – WHO your buyers work with matters. What is their level of experience? What is their process? Do they require a full file review before issuing a Pre-Approval Letter? A Pre-Approval Letter is much more than simply a document to gather for your file. Whether you are representing as a buyer’s agent or a listing agent, it’s vitally important to the success of your transaction that you carefully review the specifics of the letter being presented during negotiations. Trust me, not all Pre-Approvals are created equal.

What are some of the reasons a strong Mortgage Pre-Approval Letter is essential to a successful real estate transaction involving financing?

1. Strengthens the Offer in Competitive Markets

A strong mortgage Pre-Approval Letter helps strengthen the buyer’s negotiation position as it shows the seller the buyer is committed and qualified. When the lender has a great reputation for closing transactions smoothly and in a timely manner, this too can benefit your client’s negotiating power.

2. Helps Set Realistic Expectations

A strong mortgage pre-approval letter will clearly outline exactly what contingencies remain prior to financing approval. Example: If you receive a pre-approval letter and it indicates income and assets have been reviewed by an underwriter, this is a strong Pre-Approval Letter. If the letter references that the lender still needs to review and document income, this should waive a cautionary flag and you should question the lender further on the condition.

3. Protects Your Time and Reputation

In the real estate business, our time and reputation are our most important currency. Don’t let a bogus Pre-Approval Letter have you waste either of these precious resources.

4. Uncovers Any Financial Obstacles Early

These are very tricky market conditions. Not all borrowers, and not all transactions are strictly black and white. For example, many buyers are financed with manual or alternative products that can have unique documentation requirements. A Pre-Approval Letter should do a good job identifying any potential obstacles for all parties to the transaction.

5. Accelerates the Closing Process

If a lender is providing a strong Pre-Approval Letter, this means the necessary documentation needed to approve and close the transaction is already received. This guarantees a fast, efficient, and stress-free closing.

Why Choose Ascent Mortgage Partners for your buyer’s Pre-Approval? 

Bottom line, if you are receiving a Pre-Approval Letter from Ascent Mortgage Partners, please trust we have completed a full financial review of the buyer’s credit file with pre-underwriting.

 

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