5 Tips to Get Home Buyers Preapproved - Law & the Land - Rabideau Klein

5 Tips to Get Home Buyers Preapproved

Getting preapproved for a home loan is arguably a mandatory first step for a successful home purchase in today’s market environment. Yet, many would-be homebuyers jump into the real estate market without it. According to a survey conducted by Realtor.com, only, 51% of prospective homebuyers had gotten a preapproval before starting their home search. This can be disastrous for their chances of beating out the other offers in a tight, low-inventory market. Here then are 5 tips for helping your client get that all-important preapproval.

1. Show homebuyers the benefits of pre-approvals

One of the best ways to help your clients get preapproved for a home loan is to make that part of your initial conversation with them as part of your onboarding process. Ask them up front if they have been preapproved. If they haven’t, point out their their odds of success—or non-success, a pre-approval initiates.

Advantages include a competitive edge when making offers, less wasted time looking at houses they can’t afford, and less stress during the final days of the closing process, which produces enough high anxiety without the added uncertainty about financing. And for the realtor, working with clients who are preapproved cements your reputation as an effective real estate agent.

As part of this process, make sure your clients know the difference between being prequalified and being preapproved. Prequalification is merely an estimate of what a borrower can afford, whereas preapproval is a written commitment from a lender. The homebuyer may think they’re getting one when they’re getting the other.

2. Build a Network of Mortgage Lenders

Just as you build a solid network of stagers, home inspectors, and contractors, you should also grow connections with mortgage brokers and loan officers for two reasons. First, you can help match up the one most suited for your client, and secondly, you can expect their best personal service as they help guide your clients through the complex process from preapproval to securing a mortgage.

3. Find Out Their Closing Rate

When vetting potential loan officers to partner with, ask them their closing rate. This will help you determine how successful they will be when moving potential homebuyers from the initial consultation stage to financing their dream home.

4. Make Sure They Can Clearly Communicate with Your Clients

Communication is key. Buying a home isn’t an activity most people engage in often, so the average potential homebuyer is going to be overwhelmed and even confused as to what is required of them. Finding a loan officer who understands this and smoothly navigate your clients will help everyone involved. Does the loan officer understand which type of loan is best for a particular type of client? Are they aware of down payment assistance programs that help qualified buyers cover their down payment or closing costs? An experienced loan officer will know about these programs and can help your clients find out if they qualify for them, along with other assistance like state grants, loans, and tax credits.

5. Develop a Preapproval Checklist

Sit down with each lending partners and come up with a checklist that can help move your clients through their financing process, from getting the preapproval letter to signing their mortgage documents at closing. Specify each of your roles, as well as those of the homebuyer. Know what tasks you as the real estate agent take care of, and what duties are the loan officer’s responsibility to carry out. This keeps everyone on the same page and prevents errors, misunderstandings and hurt feelings later.

Getting preapproval for a mortgage loan is a necessary part of the home buying process, but it doesn’t have to be a daunting one for clients or a deal-breaker for agents. As a real estate agent, you are in a unique position to give each client a much-appreciated hand up. By educating potential homebuyers and partnering with curated loan officers, you’re one smooth move closer to turning anxious window shoppers into happy homeowners.

Contact Florida Bar Board-Certified Attorneys David E. Klein, Esq. and Guy Rabideau at Rabideauklein.com. They have the expertise and experience you need to ensure that your interests are protected throughout your real estate transactions across the Palm Beaches and throughout Florida. Contact Rabideau Klein today to discuss the legal implications of your Florida property transactions.

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