Before you shop for your home, it's important to know what you can afford.  Get pre-approved for a mortgage. Just five years ago, everyone told you to get pre-qualified. Today, a top Real Estate professional wouldn't even look at an offer unless the potential buyer was pre-approved. The reason is simple. 

A pre-qualification can be accomplished in minutes by phone or online.  It gives buyers a realistic estimate of their purchasing power so the don't was time looking homes that are above or below their prices range.  However, pre-qualified is based on verbal information provided to the lender and is, therefore, only an estimate of a buyer's purchasing power.  Which means someone has told the seller that you can afford a home and then a piece of paper is written out to confirm this. 

Meanwhile, a pre-approval allows buyers to secure financing before they begin shopping for their home.  Being pre-approved means a person has an approved mortgage subject to an appraisal of the property. Another reason the industry has changed to pre-approval is the time it takes to get pre-approved. Five years ago, it could have taken you up to 45 days to get pre-approved. Today is can be done in under an hour, in many cases.  

The pre-approval process accomplishes two main objectives. It lets you know how much of a house you can afford and what your monthly payments would be. It also lets the seller know that you can afford to buy their home, providing you with leverage during the negotiating process.