The chicken or the egg

March 20, 2008

… which comes first, finding a house or finding a mortgage.

Charleston homes for sale One of my listings went under contract the other day and another agent called to show the house later that day. Of course, he was told by the service that handles all agent showings in the Charleston real estate market that it just went under contract and he and his clients couldn’t view the home.

So he called me today and wanted to inquire as to whether it appeared to be a solid sale and I assured him, it looked very good, the buyer was preapproved for a mortgage and was putting a sizeable down payment on the home as well.

He said that his clients had been looking at the home but wanted to wait until they had their mortgage approval letter and I said that was very smart of them. He had to agree although he was frustrated because it appeared this would have been the perfect home for them.

So what do you do, do you start looking for homes for sale because that great home will slip away while you are obtaining mortgage approval or do you get your financing lined up and then search for available homes.

I suggest the 2^nd choice, get your mortgage preapproval because if you find a home you like and want to make an offer, no buyer will take your offer seriously unless your offer is accompanied by a letter from your bank indicating you are qualified to purchase the home. It doesn’t take long and it makes you a credible buyer.

In this one case, they were a day late on this home but they’ll be able to make an offer on the next one they like (and there are plenty of nice homes for sale in the Charleston real estate market right now).

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