How to Apply for a Mortgage Loan Preapproval

To make your home-buying process go more smoothly, get preapproved for a mortgage before you even start looking for a home. When getting preapproved, a mortgage lender reviews your finances and credit history and then gives you a preapproval letter. The letter states how large of a mortgage you can obtain. This lets you know how much house you can afford, which can help narrow your home search.

Contact your Loan Officer and let them know you want to schedule a meeting to get a mortgage loan preapproval. The loan officer may ask questions to prepare for your meeting:

What type of property do you want?

How much down payment you have?

Where do you work and how much you make?

Do I have permission to perform a credit search?

The loan officer will let you know what documents you will need to bring to the meeting.

Apply for preapproval. During the meeting, the loan officer will ask more questions to understand your mortgage needs. He will need as much information as you can provide.

Ask the loan officer to show and explain your credit report to you. This one of the most important factors in qualifying for a mortgage. It is better to know now if your credit score is too low than to find out after you have made an offer on a home.

Give the loan officer the required documents. She will use your pay stubs, bank statements and other documentation to help you find the best mortgage for your needs.

The loan officer will submit your mortgage application for processing and underwriting. The underwriter will consider your credit history, income-to-debt ratio and your level of savings. Your loan officer will explain the mortgage, the estimated interest rate, the estimated monthly payment and the estimated closing costs.

A Good Faith Estimate and Truth in Lending Disclosure, which outline all the details of the mortgage offer, will be mailed to you within three business days.

Provide your real estate agent with a copy of your mortgage preapproval letter.

If it takes a few months to find a property, your financial information may change. Your mortgage company may require updated documents to go forward with your actual mortgage loan approval.

Lenders will ask you to pay for the credit report required for the mortgage loan pre-approval. However, this is normally the only fee you for the pre-approval.

Many Problems in your mortgage situation can be resolved prior to your purchase and prevent surprises that could delay or end your purchase.

Pre-qualification and Pre-approval letters are two different things. A pre-qual gives you an idea if you can get a loan. It is helpful, but does not carry as much weight as an actual pre-approval.

If you are denied, find out what you can do to increase your chances of getting a mortgage approved in the future.

This is not an absolute guarantee of a mortgage. Your financial situation may change or the home you choose may not qualify for the loan.

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