One of the first steps in your [homebuying journey](https://www.simplifyingthemarket.com/2023/01/06/tips-to-reach-your-homebuying-goals-in-2023-infographic/?a=713258-9a8342bcf821027012880bf1d7cccbf7) is getting pre-approved. To understand why it’s such an important step, you need to understand what [pre-approval](https://www.simplifyingthemarket.com/2022/12/26/financial-fundamentals-for-first-time-homebuyers/?a=713258-9a8342bcf821027012880bf1d7cccbf7) is and what it does for you. _Business Insider_ [explains](https://www.businessinsider.com/personal-finance/mortgage-preapproval): ###### _“In a preapproval \[sic\], the lender tells you which types of loans you may be eligible to take out, how much you may be approved to borrow, and what your rate could be.”_ Basically, pre-approval gives you critical information about the homebuying process that’ll help you understand your options and what you may be able to borrow. How does it work? As part of the pre-approval process, a lender will look at your finances to determine what they’d be willing to loan you. From there, your lender will give you a pre-approval letter to help you understand how much money you can borrow. That can make it easier when you set out to search for homes because you’ll know your overall numbers. And with higher [mortgage rates](https://www.simplifyingthemarket.com/2023/01/17/think-twice-before-waiting-for-3-mortgage-rates/?a=713258-9a8342bcf821027012880bf1d7cccbf7) impacting affordability for many buyers today, a solid understanding of your numbers is even more important. #### Pre-Approval Helps Show You’re a Serious Buyer Another added benefit is pre-approval can help a seller feel more confident in your offer because it shows you’re serious about buying their house. A recent article from _Forbes_ [notes](https://www.forbes.com/advisor/mortgages/what-it-takes-to-be-preapproved-for-a-mortgage-and-why-it-matters/): ###### _“From the seller’s perspective, a preapproval \[sic\] letter from a reputable local lender often can make the difference between accepting and rejecting an offer.”_ This goes to show, even though you may not face the intense bidding wars you saw if you tried to buy during the pandemic, pre-approval is still an important part of making a strong offer. In fact, Christy Bieber, Personal Finance Writer at _The Motley Fool_ [explains](https://www.nasdaq.com/articles/this-is-the-most-important-reason-to-get-pre-approved-according-to-dave-ramsey.-but-is-he) it may be the most important part of making an offer: > ###### _“Pre-approval maximizes the chances you’ll be able to actually close the deal – and sellers want to see that._
> > ###### _The fact that a pre-approval gives you a better chance of getting your offer accepted is undoubtedly the most important reason to complete this step . . .”_ ### Bottom Line Getting pre-approved is an important first step towards buying a home. It lets you know what you can borrow and shows sellers you’re serious about purchasing their home. Connect with a local real estate professional and a trusted lender so you have the tools you need to purchase a home in today’s market. Posted by [Ryan Drowne](https://www.thedavidgreengroup.com/blog/author/ryandrowne/) on January 19th, 2023 Enjoy this blog post? Click here to subscribe for updates [Facebook Share this post on Facebook](https://www.thedavidgreengroup.com/blog/httpswwwsimplifyingthemarketcomen20230119pre-approval-in-2023-what-you-need-to-knowa713258-9a8342bcf.html# "Share this post on Facebook") Twitter Tweet this post on Twitter [Email Send a link to post via Email](mailto:?subject=Pre-Approval%20in%202023%3A%20What%20You%20Need%20To%20Know&body=I%20was%20looking%20at%20https%3A%2F%2Fwww.thedavidgreengroup.com%2Fblog%2F%20and%20I%20thought%20you%20would%20like%20to%20look%20at%20this%20blog%20entry%3A%0D%0Ahttps%3A%2F%2Fwww.thedavidgreengroup.com%2Fblog%2Fhttpswwwsimplifyingthemarketcomen20230119pre-approval-in-2023-what-you-need-to-knowa713258-9a8342bcf.html "Send a link to post via Email")[](https://www.thedavidgreengroup.com/blog/httpswwwsimplifyingthemarketcomen20230119pre-approval-in-2023-what-you-need-to-knowa713258-9a8342bcf/print.html "Opens new window with print ready page") ### Leave A Comment Leave text box empty Full Name\- required Email Address\- required Website Link e.g. yourwebsitename.com Comment\- required Submit Comment Please note that your email address is kept private upon posting. Chatra reCAPTCHA Recaptcha requires verification. [Privacy](https://www.google.com/intl/en/policies/privacy/) - [Terms](https://www.google.com/intl/en/policies/terms/) protected by **reCAPTCHA** [Privacy](https://www.google.com/intl/en/policies/privacy/) - [Terms](https://www.google.com/intl/en/policies/terms/)
