|
|
 How To Get Pre-Qualified For a Loan
Before you begin to shop for a new home, you should set up a time to meet with me, so we can figure out how much you can afford. This will put you in a better position as a buyer. That’s when it is important to understand the distinction between being pre-qualified for a loan and pre-approved for a loan. The difference between the two terms will be crucial when you decide to make an offer on a house.
To get pre-qualified for a loan, I will collect information about your debt, income, and assets. We’ll look at your credit profile and assess goals for a down payment and get an idea of different loan programs that would work for you. I will issue you a pre-qualification letter indicating the amount you are pre-qualified to borrow. It is important to understand that a pre-qualification letter is just an estimate of what you are eligible to borrow, not a commitment to lend.
To get pre-approved, you will
complete a mortgage application and it, along with the documentation I used to pre-qualify you, is submitted to the lender that best meets your needs. An underwriter looks at your file and determines if they will loan you the money. This may take anywhere from 48 hrs to 2 weeks (yes, that's 2 weeks), depending on the type of financing you are trying to get. FHA or VA loans right now are taking a long time to get approved. Once this step is complete, you will receive a pre-approval letter indicating the amount your lender is willing to lend you for your home.
So the main difference between being pre-qualified and being pre-approved is the underwriter looking at the file. But you need not be concerned that you could be qualified, then not approved and here's why. It is my job when I pre-qualify you to get accurate information and foresee any "glitches" with your scenario that could be a problem. What could be a problem for one lender is not an issue for another. I know which lenders allow which scenarios and it is that knowledge that gets my pre-qualified borrowers approved.
Remember too, that your pre-approval letter is only based on your current information. If your financial situation changes (e.g. you lose your job), interest rates rise or a specified expiration date passes, your lender must review your situation and recalculate your mortgage amount accordingly. Also, the property has to meet with the lender's approval as well, which means an appraisal needs to be done and the title report needs to be reviewed. Again, it is my job to make sure that the property you are purchasing meets the guidelines of the lender you are using.
Please feel free to call or email me if you would like to discuss your unique situation to see if you can qualify for a home!
|
|