@Anonymous wrote:
Lets say I want to buy a house.
Can I try to get approved for a range instead of 1 specific value?
For example could I apply and tell the underwriter "I want 300k as a minimum but if possible I'd like to qualify up to 400k"
Will they do that or will they only qualify me for one number at time?
As stated above, they will qualify you for your max payment (max mortgage) with certain assumptions. Those assumptions include the following:
- property taxes
- homeowners insurance
- HOA/COA if applicable
Naturally, those figures change with the selection of the actual property so you want to know your max so you can choose a property with expenses that will be less than your maximum payment. You can have two properties that are listed at the very same price and have entirely different payments due to the above three items.
Having said the above, when you speak to your Realtor, it is very common for the buyer to give a range of values from $X to $Y. That is one of the ways we screen properties for our buyers. I work with buyers all the time that qualify, for example, $400k but only want to spend $325k. You are the buyer. You get to set your budget. But I don't suggest sending in a pre-approval with $325k on a $325k offer, especially in a multi-offer situation. You look weak on paper. If you are making an offer for a $325k home, then send in your $400k approval. The seller won't be afraid that you will bomb out during the approval process. It's a strategy to show you have a capacity to buy. If you think the seller will come back with a higher counteroffer due to your pre-approval amount - that is a myth. The price you end up with is the price you negotiated through your Realtor - there is no downside to showing you are a strong buyer.
