Michelle Answers: When Should a Home Buyer Update Their Mortgage Preapproval?

Short answer: A buyer should keep a mortgage preapproval current throughout the home search, especially before submitting an offer. A preapproval prepared months ago may no longer reflect current rates, debts, income, cash available, or the price range you are actually considering.

Why a current preapproval matters

A seller wants to know that a financed buyer has recently spoken with a lender and appears prepared to move forward. For the buyer, an updated conversation can also catch changes in monthly payment before an offer is written.

Update it when your search changes

If you move into a different price range, change the size of your down payment, consider a different loan program, or begin looking at a property with taxes or association fees that are materially different from what you planned for, ask the lender to rerun the numbers.

Rates can change the payment even when the price does not

Mortgage rates move. A price that worked comfortably earlier in the search may produce a different payment later. Buyers should focus on the current projected payment and cash needed to close, not only the maximum purchase price shown on an older letter.

Tell your lender about financial changes

New debt, a job change, large transfers, changes to available cash, or other financial changes can affect financing. Buyers should communicate with their lender before making significant financial moves during the home search and transaction.

Michelle’s takeaway

Before I write an offer for a financed buyer, I want the financing conversation to reflect the property and the offer we are actually considering. That makes the offer cleaner and helps the buyer make the decision using current numbers.

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Michelle McMaster is Broker/Owner of Sail Lake Realty in Hammonton, New Jersey.