Looking at the latest housing outlook, it’s easy to think buying a home is unattainable, but that’s not true at all.
Getting pre-approved for a mortgage is the first step to homeownership in America. The process is quick and relatively painless — if done right.
This article will tell you how to get pre-approved for a mortgage so that when it’s time to buy a home, you’re all set.
Here’s How To Get Pre-Approved For A Mortgage
You might be saying “why should I get pre-approved anyway?” Well, that’s the only way a lender can approve you for a mortgage.
Keep reading to see how the process will be done and what you can do to be in the best position possible for getting a home.
Why You Need To Get Pre-Approved For A Mortgage
Shopping for a home without being pre-qualified for a mortgage is pretty much pointless. That’s why you need to get the process started by getting pre-approved.
Lenders will only take you serious if you are pre-approved, which is why that is the first question they will typically ask before they spend time with you.
The way the process works is by going through a mortgage pre-qualification and mortgage pre-approval.
What Is A Mortgage Pre-Qualification?
A mortgage pre-qualification is a quick process that involves the lender asking you a series of questions to gauge your readiness for purchasing a home.
Lenders may typically inquire of your finances, your assets and any debts you have. After that, it’s time to pull your credit.
What Is A Mortgage Pre-Approval?
With a mortgage pre-approval, the lender pulls your credit to see how in debt you are as well as how much money you can borrow toward the purchase of a home.
You’ll need a credit score above 600 to get the best rates.
Here are some things you can do to make sure you’re ready to get pre-approved without issues.
Contrary to popular belief, lender inquiries for pre-approved have no bearing on your credit score, so you won’t have to worry about your creditworthiness dropping.
One thing you do want to do beforehand is make sure your credit is A-OK.
Check Your Credit Report
.You can check your report from each of the three credit bureaus online at AnnualCreditReport.com.
Your credit history is one of the main things that lenders consider when it comes to determining whether you get pre-approved.
What Documents Do You Need?
When it’s time to get pre-approved, the lender will typically ask for a summary of your finances. This can be determined by collecting the following documents.
- Personal ID
- W-2 forms
- Pay stub.
- Tax returns
- Bank statements
How Long Does Pre-Approval Take?
Although it sounds like a long process, pre-approval can be done relatively quickly. The key is to have all your ducks — documents — in a row.
The good news is that you can actually get pre-qualified online with the major banks. All you have to do is fill out an online application with your respective financial institution.
Final Word
Getting pre-approved for a mortgage can be an exciting process, but you need to do it right so that there aren’t any problems. AS a reminder, keep all your documents together so that you have everything you need.
After it’s all said and done, you should receive your pre-approval letter in about a week and a half. After that, you can begin your home search with confidence.
