Pre-Approval

The Importance of a Valid Pre-Approval

The pre-approval process may be the most important step in the home buying journey. This is where you and your loan officer determine a monthly payment amount that suits your needs and the amount of funds required from you at the closing table. A valid pre-approval confirms your creditworthiness to realtors and sellers. A buyer with a valid pre-approval letter is in a much better position when the seller is considering their offer. A valid pre-approval letter is based on a review of your credit report, income, and assets. Any lender that does not review credit, income, & assets cannot provide a valid preapproval letter.

How do I get Pre-Approved?

Many applicants choose to complete an online pre-approval application. However, the application can also be completed with your loan officer over the phone or with a face-to-face meeting. You will need to provide personal information such as social security number, DOB, housing and employment history, and current assets. Your credit report will receive a hard inquiry but don’t worry. If you are mortgage shopping and your credit is checked by several different mortgage lenders within 45 days, the bureaus treat this as one credit inquiry when impacting scores. In addition, mortgage inquiries affect scores very little, even if outside of that 45-day window. If all factors meet underwriting guidelines, your loan officer will issue a preapproval letter that is good for 120 days from the date of the credit inquiry. Pre-Approval