Why Do You Need to Get Reapproved?

If you're a buyer and you haven't spoken to your lender in a while, you need to make sure that you get reapproved.

In today’s current market, with the interest rates on the rise, it is really critical that you discuss with your lender where you currently stand. Due to the fact that the fluctuation in prices in the stock and bond market, you’re seeing rates increase. Now, when the rates increase, obviously, that affects the buyer’s affordability. As an example, let us take a house with a $1 million sales price and 20% down. Comparing the monthly mortgage payment in January of 2022 with the interest rate of 3.25% against the same house in April of 2022 with an interest rate of 5%, we are seeing an increase of almost $800. Now, throw in the fact that prices have increased substantially since the beginning of the year, we are probably looking at about a $900 increase in monthly payments. 

“If you’re looking right now to buy in this market, you need to really be in touch with your lender on a weekly basis.” So, what does that mean to you if you are a buyer? It is really important that you discuss with your lender where you stand. It is not only going to affect your affordability, but it gives you a much better idea of where you’re going to be at with your monthly payment. We bring this up because we constantly see buyers coming into our open houses and they think the interest rate is still in the 4s, low 4s, and even in the high 3s. They are shocked to learn of the increase in rates because they have not spoken to their lender or had their pre-approval letter updated recently.