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How to get a mortgage pre-approval

How to get a mortgage pre-approval

Mortgage Preapproval vs Prequalification

There is a big difference between mortgage preapproval and prequalification.  A lender can prequalify you after a quick conversation, but sellers won’t take your offer very seriously.  Whereas a preapproval will tell sellers that your lender has done their due diligence in assessing your ability to qualify for a loan.  In today’s competitive market, you need to submit a preapproval with desktop underwriting.

It is important to note that having a preapproval does not obligate you to a particular lender.  You should shop around for the best rate and terms.  You can apply for a mortgage pre-approval through many different types of lenders.  Mortgage brokers tend to be a good choice because they usually work for an independent mortgage company so they can shop multiple lenders on your behalf.  Mortgage brokers are typically paid by the lender after a loan closes; sometimes the borrower pays the broker’s commission upfront at closing. ASK!

Documents Needed

  • Driver’s license or passport
  • SS or permanent resident card
  • Credit history- lender will pull this for you
  • Employment verification
  • Pay stubs for the past 30 days
  • Federal income tax returns
  • W-2s for the past two years
  • Proof additional income
  • Bank statements

Don’t forget to bring proof of funds for your down payment and closing costs in the form of bank statements, statements from stock accounts and mutual funds, a grant approval certificate and/or a gift letter.

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