Are you pre-qualified or pre-approved for a loan?
Before you begin to shop for a new home, you should set up a time to meet with us, 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.
1. Click on mortgage application to complete a mortgage application and we will be notified.
2. Provide me with various information verifying your employment
a. 2 most recent paystubs
b. Last 2 years W2’s
c. Last 2 years Federal tax returns
d. Self-employed last 2 years Federal tax returns 1120’s, 1065’s, K1’s
3. Assets and financial status
a. 2 most recent bank statements
b. Most recent quarterly retirement statement
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We’ll review your mortgage options and submit your application to the lender that best meets your needs. Once the application process is complete you will receive a pre-approval letter indicating the amount your lender is willing to lend you for your home. When submitting your offer to a seller, a pre-approval letter will give you the competitive advantage. It will show the seller that you are approved and now the home has to get approved.
**A pre-approval letter is not binding on the lender; it is subject to an appraisal of the home you wish to purchase and certain other conditions. 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.