First time buyers generally have lots of questions about the buying process – what happens, what can I expect, who does what, and so on. I thought it might be helpful to have a series on FAQs that buyers ask. I won™t cover everything, but try to hit the biggies. And, of course, if you have specific questions, please feel free to post them here and I will answer them in a subsequent post.

What is a pre-approval? Is this something I should do? A pre-approval is when a bank or ortgage officer reviews your financial status to determine  ifyou can get approved for a loan. This is a MUST DO step for all buyers (unless you are paying cash) so you will know what you can afford to spend on a home. This is also a good time to find out if there are issues with your credit that need to be fixed before you actually apply for a loan. The mortgage person will look at your credit report and FICO scores  (there are 3 major credit reporting agencies, and typically the middle of the 3 scores is used), and gather information from you regarding your assets, debts, and income, in order to determine how much you can afford based on your monthly expenses (loans & credit cards are the big things they consider, and a debt ratio that is too high will preclude you from getting a loan).  They will also consider projected taxes, homeowner™s insurance, condo or HOA fees. The loan officer can issue a pre-approval letter to your Realtor and you are ready to start looking. Some buyers only get pre-qualified (where the credit is not reviewed). I wouldn™t waste your time with this, since many feel pre-quals are worthless, and any agent who is getting an offer from a buyer will request a pre-approval letter.