Purchasing a home can be an overwhelming process. To ensure the transaction is smooth from start to finish, buyers should establish a plan and assemble a team of professionals who will assist with the process.

Before meeting with a realtor or a lawyer, purchasers should consult with a mortgage specialist to obtain a mortgage pre-approval. Buyers should know what they can borrow to determine the type of home that they can afford.

By obtaining a mortgage pre-approval, buyers can shop with confidence. It is not practical or reasonable for buyers to spend time viewing homes that are beyond their price range.

Many people experience frustration when they discover they can’t afford the house they have offered to buy. In fact, many realtors will not work with buyers unless they are pre-approved.

In addition to confirming a loan amount, a pre-approval is will also guarantee an interest rate. Lenders will lock in the rate for a specific term, typically 90 to 120 days. If interest rates go up while shopping for a home, the pre-approval guarantees the original, lower rate. However, if interest rates go down, lenders will offer borrowers the new, lower rate.

In addition to establishing borrowing limits and guaranteeing rates, mortgage pre-approvals can prepare buyers for competing in a strong market. Properties that are in high demand will regularly attract competing offers. A mortgage pre-approval will increase your bargaining power and allow you to present a stronger offer.

To grant a pre-approval, your lender will likely require the following: Personal information, including copies of identification, employment details, confirmation of salary and source of income, details on all bank accounts, loans and other debts, the source of the down payment as well as the funds needed to pay for all closing costs.

– Elias Metlej is a real estate lawyer with the Halifax firm Blois Nickerson & Bryson. You can write to Elias at askelias@yahoo.com

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