Real Estate Blog - Tracy, Ca: Pre-approval with the bank who owns the home:

Tuesday, October 05, 2010

Pre-approval with the bank who owns the home:

Pre-approval with the bank who owns the home:
When making an offer on a REO home it is to your advantage to be pre-approved with the bank that owns the home. When making an offer on a home having a pre-approval letter from the bank who owns the home will increase your chances of beating a competing offer from a buyer with the same offer or even slightly higher without.

The problem with getting pre-approved once you see the house you like is that it takes time for the approval process, about 3-5 days average. So it is best to get cross qualified with a few of the different major banks in your area before hand. The advantage is that you will be able to get preference with any bank which you qualify with. Also you will be able to shop the different banks to get your best terms and rate. Since most of the listing are either Wells Fargo or Homesteps and Homepath, or fannie and freddie. I recommend to buyers to get qualified with all three. Most of the smaller banks also prefer to at least see a known institutional lender. I recommend starting with Wells Fargo, then go from there.

Pre-approved VS Pre-qualified:

What is the difference? Getting pre-qualified is the first step in the mortgage process. It involves supplying a lender with basic information regarding your debt, income and assets. From this information, lenders can get an idea of the mortgage amount for which you qualify, and it can usually be done at no cost.

Getting pre-approved is the next step. The process requires that you complete a mortgage application (and usually pay an application fee) and supply a lender with all the necessary documentation to check your financial background and credit rating. You will then be told the exact mortgage amount for which you are approved

Bank sellers only acceped pre-approval letters with offers.

Different websites which list homes by bank:

All of the different banks who sell homes as foreclosures have their own websites which list the homes they own. Below is a list of the different websites banks have set up to preview their homes. Its a good idea to check out what homes are available for the bank you are planning on doing business with.