What is a pre-underwrite? Will it help me win a house in this competitive market?
A pre-underwrite is simply submitting your loan information to an underwriter prior to having a house under contract to purchase. With a pre-underwrite, your purchase is not contingent upon loan approval because the loan is already approved.
No Surprises in Underwriting!
A pre-underwrite eliminates any stressful surprises that occur during a typical underwriting process. Submit your documentation early to obtain a pre-underwrite approval and expect a stress-free buying experience. Once your offer has been accepted, you will be occupied with the property inspection, potential negotiations with the seller, submitting earnest money and other house buying chores. In a typical loan underwrite process, you will be required to submit documents for loan approval while handling these other responsibilities listed above! Yuck! Lastly, you will not be burdened with last-minute surprises just days before closing. Your ducks will be in a row!
Happy Seller Means Offer Accepted!
A seller that receives a pre-underwrite purchase offer is a happy seller! A happy seller is more likely to accept your offer because they are excited about the certainty of your offer. The closest thing to a cash offer is an offer submitted by an approved buyer, specifically one that does not include a buyer approval contingency. Simply put, your offer is solid, and your lender’s contribution is essentially guaranteed.
Edge Out the Competition!
Cash purchases of single-family homes in 2020 were at a 13-year low because of Covid, low mortgage interest rates and a general uncertainty in the market. Most people in today’s market are submitting offers to purchase with a mortgage loan. When a seller sees that your offer is not contingent upon buyer loan approval because of your pre-underwrite, expect to stand out!