Getting Pre-Qualified and Pre-Approved
Should you talk to a mortgage professional before house hunting?
Absolutely! Even if you haven't so much as picked out houses to visit yet, it's important to see your mortgage professional first. Why? What can we do for you if you haven't negotiated a price, and don't know yet how much you want to borrow?
(Of course, you first need to know the current interest rates so go ahead and review my rates by clicking here. My rates normally equal or beat Di-Tech, GMAC, Quicken & E-Loan on a consistent basis)
When we pre-qualify you, we help you determine how much of a monthly mortgage payment you can afford, and how much we can loan you. We do this by considering your income and debts, your employment and residence situations, your available funds for down payment, closing costs and required reserves, and some other things. It's short and to the point, and we keep the paperwork to a minimum!
Once you qualify, we give you what's called a Pre-Qualification Letter (your real estate agent might call it a "pre-qual"), which says that we are working with you to find the best loan to meet your needs and that we're confident you'll qualify for a loan for a certain amount.
As you narrow down the home choices and you are pretty confident in finding a suitable home, it's time to get pre-approved. This where a three credit bureau mortgage credit report is ran, the loan processed and all the documention and loan application is presented to a loan underwriter for conditional approval. This is an approval subject property and title review.
When you find a house that catches your eye, and you decide to make an offer, being pre-approved, with a Pre-Approval Letter in hand, for a mortgage will do a couple of things. First, it lets you know how much you can offer. Your real estate agent will help you decide on an appropriate offer, but being pre-approved gives you the confidence to know you can follow through.
