{"id":3103,"date":"2016-02-18T01:34:25","date_gmt":"2016-02-18T01:34:25","guid":{"rendered":"http:\/\/teammovemortgage.com\/?p=3103"},"modified":"2020-07-13T22:33:29","modified_gmt":"2020-07-13T22:33:29","slug":"pre-qualification-letter-why-are-realtors-requiring-it-before-showing-homes","status":"publish","type":"post","link":"https:\/\/teammovemortgage.com\/blog\/pre-qualification-letter-why-are-realtors-requiring-it-before-showing-homes\/","title":{"rendered":"Prequalification letter, Why Are Buyers Agents Requiring It Before Showing Me Houses?"},"content":{"rendered":"

Why does your Realtor require that you get prequalified as a buyer before showing properties?<\/h1>\n

\"Why<\/p>\n

Occasionally we hear buyers say that a Realtor would not “work” for them because the Realtor would not show them a house that the buyer just loves until there is a valid prequalification letter.\u00a0 Actually the opposite thinking is correct!\u00a0 A Realtor is “working for”\u00a0AND “representing” their buyer very well by requiring a prequalification by a reputable mortgage lender before showing property.\u00a0 We have even compiled a detailed list of the top reasons a buyer should be very happy that the Realtor requires a solid prequalification letter.<\/p>\n

Top Reasons a Realtor Would Require a SOLID Prequalification Letter from a Reputable Lender<\/h2>\n
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  1. Limited credit knowledge:<\/strong>\u00a0 Many buyers do not know their credit scores and what is\u00a0on their credit report.\u00a0 Knowing this information up-front prevents issues later that can be known now.<\/li>\n
  2. Erroneous personal credit knowledge:<\/strong>\u00a0 Often there are derogatory items on credit the buyer didn’t even know about.\u00a0 Almost every time we pull credit there are surprises good and bad.<\/li>\n
  3. Complicated guidelines:<\/strong>\u00a0 Most buyers do not know mortgage guidelines such as how to calculate debt ratios, determine loan products available, reviewing credit report, among countless other areas.<\/li>\n
  4. Time & cost\u00a0effectiveness:<\/strong>\u00a0 The Realtor is taking time away from other work and spending their own money to show you properties.\u00a0 Would you drive around to 20 properties in your car without proof of qualification?\u00a0 If you would, I\u00a0bet you wouldn’t do it long!<\/li>\n
  5. Focused home search:<\/strong>\u00a0 The Realtor wants to show you homes that are in your prequalified price range that meet your goals.\u00a0 Knowing your prequalified price range plus your comfort range will make a buyer’s search be more focused and less time wasted by the buyer, Realtor, and sellers.<\/li>\n
  6. Seller Courtesy:\u00a0 <\/strong>The seller is frantically cleaning, organizing, and leaving their house open for you.\u00a0 Would you want to do this for someone that just wishes they could buy your house but doesn’t really qualify?<\/li>\n
  7. Seller Confidence:<\/strong>\u00a0 The seller more than likely wants to buy a house too so they are making\u00a0an important decision based on your qualification and needs confidence in you.\u00a0 If you were the seller, would you want your dream purchase to fall apart because you find out a week or\u00a0even later that their buyer never qualified?<\/li>\n
  8. Reputation for your best deal:\u00a0<\/strong> The Realtor has a reputation to uphold.\u00a0 A Realtor is hired by a buyer to negotiate with the sellers or their agent.\u00a0 If the Realtor continuously brings unqualified buyers to other agents, it will hurt the Realtor’s reputation and ability to best negotiate for you.<\/li>\n
  9. Negotiating power:<\/strong>\u00a0 It helps your negotiating power and helps you stand out among other offers.\u00a0 A buyer wants the best deal and to capture the house he\/she wants, so buyers should want to show as a “qualified” buyer with a high probability of closing assuming the appraisal, title search, and inspections are acceptable.<\/li>\n
  10. Your best interest:<\/strong>\u00a0 Your Realtor wants to find the best home for your goals and qualification.\u00a0 In the end the Realtor wants what is best for you and doesn’t want to waste your time or money.<\/li>\n<\/ol>\n

    Main Types \/ Levels of Mortgage Prequalification Letters<\/h2>\n
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    1. Basic verbal\u00a0buyer information and no credit report pulled<\/strong> – Why would someone accept this?<\/li>\n
    2. Verbal buyer information and a tri-merge credit report<\/strong> – Better but still based on buyer verbal information.\u00a0 At least the credit “should” qualify but the other items are not verified.<\/li>\n
    3. Verbal buyer information, actual income asset and credit documentation, and a tri-merge credit report<\/strong> – Best and what sellers and agents should require for the best outcome probability because tax returns have been reviewed, employment and maybe rent have been verified, as well as assets have been verified sufficient for closing.<\/li>\n<\/ol>\n

      Check out our next article called Understanding the Levels of Prequalification Letters<\/a><\/strong><\/span><\/p>\n

      So next time your Realtor says “I need you to get prequalified for a mortgage before I show you properties”, remember that your Realtor is not picking on you and is actually looking out for your best interests!<\/p>\n

      Additional Resources:<\/strong><\/p>\n