You get excited about purchasing a property and start looking right away, but hold on – do you know how much house you can afford?
I see this all the time. Someone gets the investing bug (and rightfully so) and goes full steam into looking at properties before they get an idea what they can afford.
Don’t Put the Cart Before The Horse
In nearly all of my posts, at some point I talk about running the numbers on a property to ensure you buy right.
Well, before you can do that you need to know what price point you can afford. Unless you are buying a property with cash then you need to talk to a lender and see what kind of loan you qualify for.
There are two ways to go about this:
- Preapproval or Prequalified
I want you to understand the difference between the two:
A prequalification basically provides a number the bank thinks they will lend you based on the information provided.
The Preapproval is the amount the bank will lend you.
With that said, one is much easier and quicker to obtain than the other.
For full details on what you need to do for a prequalification or preapproval see the whole article here: https://scaredycatguide.com/know-how-much-you-can-afford-before-looking-for-properties/
Best Regards,
