Why Get Pre-Approved?
1. Pre-qualification acts as a dry run of the loan application process. The mortgage lender will use details you provide about your credit, income, assets and debts to arrive at an estimate of how much mortgage you can afford. The whole process may take only minutes or a few hours at most, and is free. This is a good way to get a general idea of how much you can afford so that you can target your home search.
2. A "pre-qual" is non-binding to the lender (because the information you provide has not been verified), so it only serves as an indication to potential sellers of your general creditworthiness. This does not provide much assurance to a seller that you can actually obtain the necessary financing.
3. These days most sellers will NOT accept an offer without at least a pre-approval letter. So, once you are serious about buying you should get pre-approved. That way you can act quickly when find a home you love.
4. When you are pre-approved by a mortgage lender that means that they have verified the financial information you have provided by reviewing supporting documentation such as bank records, income tax returns, and more. It is best if the lender sends this information to the underwriter for review so that any issues in your file can be addressed ahead of time and they can virtually guarantee financing, assuming your financial situation does not change and the home you want to purchase appraises. This is especially important if you are self-employed or have complicated compensation packages involving RSUs and bonuses.
5. If you need help getting pre-approved, please contact me today. I have several different brokers and lenders I can recommend depending on your financial situation.