(Closed) House Price vs. Preapproval

posted 5 years ago in Home
Post # 3
Member
499 posts
Helper bee
  • Wedding: September 2012

I spend a little more than 1/3 of my preapproval amount. My intention was to NOT be housepoor! I was shocked that they preapproved me for such a hefty loan! I remember thinking “this is probably why there are so many foreclosures right now”…

Post # 4
Member
1333 posts
Bumble bee
  • Wedding: May 2014

When I was single, and the sole buyer of MY first home (in my mid-20’s) I was pre-approved for $130K, but bought a quaint 2-bedroom/2-bathroom home for $95K.

The reason I spent so much less is because I met with a financial advisor, whom not only looked at my debt to income ratio (where pre-approval comes from, essentially),  but looked at my other monthly costs…gas, insurance, entertainment spending, etc.  He was the one that made me really see that although the bank stated I could afford x amount, the reality was that in order to maintain the lifestyle I am used too, I would be better spending no more than y, which was 100k.  IM SO GLAD I FOLLOWED HIS ADVICE!!

Post # 5
Member
955 posts
Busy bee
  • Wedding: November 1999

Our mortgage was about 60% of what we were approved for– that was our own personal choice.  Sure, we could have spent more, but we didn’t want to paint outselves into a corner if one of us lost our job, got sick, etc.

 

 

Post # 6
Member
118 posts
Blushing bee
  • Wedding: April 2014

We had a number that we knew we didn’t want to go over and had that amount pre-approved rather than getting the largest number we could.  That would have been too tempting for me knowing we could potentially look at houses that were way more than we wanted to spend! 🙂

Post # 8
Member
1846 posts
Buzzing bee
  • Wedding: June 2013

We were pre-approved for $650K, and our mortgage ended up being $290K. We had a $50K down payment.

Post # 9
Member
2023 posts
Buzzing bee
  • Wedding: May 2013

My first house – I completely maxed out my preapproval amount. MISTAKE.  DONT DO IT.  I had no business buying a house for that much.  I was definitely strapped for cash during that.

My Fiance just bought us a house this fall.  His was 70% of his approval amount.  We definitely wanted to make sure that if something happened to one of us, and we couldnt work, that we were more than able to take care of the mortgage payment with one income.

Post # 10
Member
9198 posts
Buzzing Beekeeper
  • Wedding: August 2013 - Rocky Mountains USA

We were approved up to $350,000 or some crazy number.  Wanted to spend less than $160,000 and ended up with a $130,000 house – so about 37% of our pre-approval amount.  I agree with @ddavila2001 – when I got the pre-approval number back, I was like “Well no wonder so many people are in foreclosures!”  

I have a decent job and my Fiance is currently unemployed but should also have a decent job within a few months.  Currently, I can pay our entire mortgage and bills on 1 week’s worth of pay – which is how we wanted it.  

Post # 11
Member
808 posts
Busy bee
  • Wedding: February 2013

Dh bought the house on his income alone (because it was a VA loan and we weren’t married) and it was about 80% of what he was pre-approved for. If we had gone with both our incomes then about 1/2 of what we could have gotten.

Post # 12
Member
5423 posts
Bee Keeper
  • Wedding: November 2012

We told the company how much we were willing to borrow.  We didn’t let them give us a number.

Post # 13
Member
5221 posts
Bee Keeper

We spent 50%  less than what we were preapproved for. 

Post # 14
Member
3417 posts
Sugar bee
  • Wedding: September 2014 - Lodge

We have been pre-approved for $180 and that’s what we are spending.  The asking price was actually $185 but we negotiated to $180.  Now we just need things to fall into our favor to actually get this house.

Post # 15
Member
1116 posts
Bumble bee
  • Wedding: September 2012

My husband is in the biz so we actually just asked to be approved for our offer amount.  He says if we just asked to be preapproved we would have been approved for something more than double what we want to spend.  So instead of finding that out and having that tugging in the back of our minds we just asked for the smaller amount.  Based on what Darling Husband says it will be approx 45%-50% of what we’d get approved for

Post # 16
Member
2622 posts
Sugar bee
  • Wedding: November 1999

We were preapproved 3 years ago for $750K, but we make more money now so not sure what it would be now.   We plan on buying around $450K when we move (hopefully) to another state.  We want to be able to live on one salary as well as have a full 20% downpayment and plenty of leftover cash for living, savings, emergency fund and furnishing the extra space, etc

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