Many times, as a direct buyer, inquiring on a property listed by an agent representing the seller. This will usually be the first why question – “Have you gotten your In Principle Approval (IPA)?” Don’t be taken aback or think that the agent is being rude. Here are just two reasons why this question is an important qualifying factor.
- Agents safety net (representing sellers)
Don’t want to waste time on fake buyers or have no ability to buy. Being a self-employed, time is money.
Furthermore, by ensuring that the buyer is backed by a bank about his financing capability, agent then can be assured that his seller’s interest (time) is well spent as well.
- Increase negotiation power (representing buyers)
Easily to bring prices down from the seller when there is a ready buyer with proof of IPA. There are cases where some seller don’t even want to start talking about price before they see the IPA.
In short, always do a preliminary financial assessment with your agent and get an IPA from a bank before you start to think about which property to buy.