Pre-qualification and pre-approval
A pre-qualification is usually a quick estimate based on what you tell a lender. A pre-approval goes further: the lender reviews documentation and your credit before stating what it is prepared to lend, subject to conditions. Sellers take a pre-approval more seriously, and it gives you a firmer budget.
What lenders typically ask for
Requirements vary by lender and loan type, but expect to provide:
- Proof of income, such as recent pay stubs, W-2s or tax returns
- Bank and asset statements
- Information about existing debts
- Permission to check your credit
Budget for the whole payment
The loan payment is only part of the monthly cost. On this coast, plan for property taxes, homeowners insurance, flood insurance where needed or wise, and any association dues. Insurance in particular varies with the home’s age, roof, construction, location and flood zone, so get an estimate for the kind of home you’re considering before you settle on a price range.
Keep things steady until closing
After a pre-approval, avoid changes that could affect your application, such as opening new credit, making large purchases on credit, or moving large sums between accounts without documentation. If something changes, tell your lender early.
Compare lenders
Rates, fees and loan programs differ. It’s reasonable to talk to more than one lender and compare the official loan estimates you receive. Choose the lender that fits your situation; you’re never required to use a particular lender to work with me.
Sources and official resources
This article is general information, not legal, tax, insurance, lending or inspection advice. Rules and programs change; confirm details with the controlling office or a licensed professional for your situation.