How to Get Pre-Approved for a Home Loan
When you are starting to shop for a new home, getting a pre-approved home loan can help you know what you can afford. Then, moving forward you can set reasonable expectations and have a better chance at making a successful offer and getting the keys to your dream home.
Pre-Approval Makes You a Stronger Buyer
Pre-approved means your lender has already evaluated your credit history and is willing to give you a mortgage, subject to an appraisal of the property certain defined conditions. This can be a valuable tool as sellers often prefer to work with someone who is able to close the deal and pre-approvals are typically valid for 60 to 90 days.
What Do You Need to Get Pre-Approved?
Getting a pre-approved home loan is similar to applying for an actual mortgage. Documents you need for pre-approval include:
- Government-issued ID
- Proof of Income (tax returns, pay stubs, W-2s, real estate income, etc.)
- Financial statements (brokerage accounts, retirement accounts, bank statements, etc.)
- List of debt (student loans, mortgages, auto loans, credit cards, etc.)
- Proof of the last 12 months of payments for your rental unit
- Contact information for landlords for the last 2 years
How to Get Pre-Approved?
Getting pre-approval is the first stage in securing your home financing. Here’s how to get pre-approved.
- Step 1: Select a mortgage broker
- Step 2: Choose your home loan
- Step 3: Submit all required documentation
- Step 4: Loan officer submits application to the underwriter for pre-approval
- Step 5: Underwriter evaluates application and either deny or approve with conditions
The timeline for pre-approval varies depending on the type of underwriter used (automated vs manual). Pre-approval can take between one day and four weeks.
Pre-Approval is Helpful But Not Mandatory
Pre-approval helps you understand how much house you can get. It also helps sellers feel comfortable accepting your offer, knowing you’ll likely be able to close on the home. As helpful as pre-approval is, it is required. However, waiting to apply for a home loan may mean you miss out on the home you want.
Apply Today
If you’re ready to make your dream of owning a home a reality, Loan officers at Mortgage Solutions Financial can help you find the financing option that suits your needs. Contact us to learn more and we’ll get you on your way towards a pre-approved home loan today.
