Having a mortgage pre-approval letter can make a world of difference when you are going to look for a house. It will allow you to walk into a house knowing you can make an offer on the spot and be reasonably sure the money will be there waiting for you. It’s a fantastic confidence booster in the world of house hunting and home buying. But you may be asking yourself “what do I need for a mortgage pre-approval?” or “where do I even start the pre-approval process?” You shouldn’t worry about that, however, because getting pre-approved for a mortgage is actually one of the easier things about purchasing a home.
What Do I Need to Know Before I Apply for Pre-Approval?
Before you start the mortgage pre-approval process, there are a few things you should know about your personal financial history.
- Assets and Liabilities – Right off the bat, the lender is going to want to know what you have paid for outright and what kind of debt you have. Things like credit cards, student loans, and car loans are all going to be included under this umbrella. On the flip side, things like paid off cars or boats, savings accounts, and retirement accounts will also be included.
- Proof of Income – Before you buy a house, you have to be able to show that you can pay for it. The best way to show this is by using your paystub. Some lenders may also require a year or two’s worth of tax returns. For additional peace-of-mind, the lender may require your employer to write a letter stating how long you’ve been employed and your salary information.
- Down Payment – Knowing the amount of your down payment will make a world of difference in your pre-approval. Obviously, the bigger the down payment, the less your monthly mortgage payment will be. Also, if you have more than 20% of the purchase price, you won’t have to worry about getting mortgage insurance.
How Do I Apply for Mortgage Pre-Approval?
Almost every bank or lender will have the pre-approval process right there on their website. In order to get the absolute best rates, you might want to try talking to several of them to see what they have to offer you. At the very least, don’t go with the first thing they tell you. Shop around a bit; it will absolutely be worth it in the end.
If you don’t want to do all of that work yourself, you can also talk to a mortgage broker. A broker’s job is to do all of the looking around for you. He or she will take your information, call the lenders and banks for you, and come back to you with only the best offers. Oh, and don’t worry, the mortgage broker comes at no cost to you…they get their money from the lenders on the other end.
So if you’re ready to start the pre-approval process, be sure to head over to www.mymortgagebroker.com and get in contact with Steven Owens. He can help you through the process and answer any additional questions you may have.