PRE-APPROVAL: in this hot housing market every buyer should be

In today's hyper-competitive real estate market, any roadblock that might slow things down is a deal killer. That's why it's critically important for buyers to get pre-approved for a loan before they start shopping.

"Getting pre-approval from a mortgage lender means they're doing a lot of the work on the front end, like verifying your income and your employment, and calculating your debt ratio, and coming up with an estimate that they're reasonably confident in that they would lend to you if your situation doesn't change," said Greg McBride, chief financial analyst at Bankrate.com.

That pre-approval is something you can show to the home seller when you make an offer.

"It gives them confidence that your offer is legit, and that the deal is going to go through," McBride explained. "One of the big hesitations sellers have - particularly in a hot market like this - they don't want to take a house off the market for the deal only to fall through later."

Getting pre-approved for a mortgage also sets some boundaries for you, the buyer - letting you know what you can afford to spend — something that's important at a time of surging prices and heated bidding wars.

More Info:

Bankrate: Loan Prequalification Calculator