No. of Recommendations: 3
Hi Shanamaria,

Is it true that one shouldn't have to pay for a pre-approval?

Absolutely true. A real pre-approval is going to take a bit of work, mind you. You'll need to do all the preliminary application documents, sign the disclosures and disclaimers, and gather up your checklist of personal financials (bank statements, W2's etc. etc.), so it's not something you'll want to take lightly.

If you get a pre-approval from someone who hasn't done all this, they're blowing smoke up your chimney... That's why you should take the time to search and find a loan pro you can communicate with and trust above all else.

Is it true that if you are pre-approved by a lender at a certain rate, you don't necessarily have to get your actual mortgage from that same lender under those terms?

Sure... a pre-approval is not a commitment on either party's part. In the finance business, either side can walk up until the ink hits the final documents at closing escrow. Another reason to focus on trustworthiness and reputation.

We've heard it makes sense to "shop around" for a good mortgage -- does this occur at the pre-approval stage, or once we actually find a house we want to buy?

"Shopping around for a mortgage" is a feel-good hallucination a lot of people hope to get. The bottom line is you can avoid getting ripped off, but you won't be able to get the best deals yourself. The best deals can only be accessed by a licensed professional who will operate in such a way to actually GIVE you the best deal available.

The best time to shop for such a trustworthy pro is long before you have any other pressures. The best decisions are made when there's not necessarily any emergencies, urgencies, or rushes. Shopping for a home first is begging for a self-imposed urgency (enter the fast-talking, hard-closing schlocksters!)

Does it matter who we get pre-approved by -- a lender affiliated with (or at least who has a relationship with) our realtor?

The only thing that matters is you get yourself a professional you can trust to represent your true best interests. You may find such a person through a referral, and that referral MAY be from your realtor... but the schlockiest option might be from your realtor as well.

Ask around... let everyone you know know what your criteria is for a trustworthy financial professional who fits your personality and communication style. If you're willing to be open and share your desires with a lot of folks, the right person will inevitably be introduced to you, or you easily lead to meet him.

Good luck! You're on the right path!!!
Dave Donhoff
Lic. Mortgage Broker
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