Preapproved Mortgage Loan

pre-approved-mortgage-loanGetting a preapproved mortgage loan (being preapproved for a mortgage loan) is something anyone considering buying real estate should do.  It can make the difference between finding your dream home or not. And whether or not you get the best deal on it or not.

What exactly is a “preapproved mortgage loan?”

A preapproved mortgage or loan is exactly what it sounds like … you have already been approved for a home mortgage loan by a lender or lenders to a certain loan amount, a mortgage rate, and for a certain amount of time.

This pre-approval is based on a number of financial factors about your personal finance situation; including your income, your debt, your banking credit, your credit score, and your assets. Most mortgage lenders will require the following:

  • W2 and/or 1099 Income Statements (for the last 2 years)pre-approved-mortgage-loan
  • Federal Tax Returns (for the last 2 years)
  • Bank Statements (usually for the last 6 months)
  • Recent Pay Stubs (and/or proof of other income)
  • Proof Of Investment Income

A preapproved home loan is a lender’s actual commitment to you. And, if you’re smart, you can use this for your advantage when shopping for, and when making an offer, on a house you want to buy. More on this in a bit.

Preapproved Mortgage vs. Mortgage Pre Qualification

As mentioned above, having a mortgage preapproval from a particular lender in fact means you have an approved mortgage … you have filled out a mortgage application, maybe done some work on a mortgage calculator, the bank or lender has run a credit check on you, you have some rate quotes or at least mortgage rates have been discussed, you should have some idea of closing costs, maybe you have decided to pay off some credit cards or do some debt consolidation, and you have amortgage pre-approval letter or certificate in hand.

A Mortgage Pre-Qualification is a somewhat informal process to see how much you “should” be able to take out in a home mortgage. There is no obligation on the part of the lender or on you. This can actually be done over the phone or online. Info required is usually (usually no paperwork or verification is required):

  • Your Income
  • Your Credit Card And Other Debt
  • Your Down Payment Amount

As you can see, pre qualifying for a mortgage loan is quite a bit simpler than being pre approved for a mortgage loan. While being pre-qualified for a home mortgage doesn’t guarantee you’ll eventually be approved for your loan, it does help you in choosing your home, working with your realtor, and in getting a good deal.

Pre Qualifying For An FHA Loan

Since 1934, the Federal Housing Administration (FHA) has helped individuals and families become home owners by insuring your loan so your mortgage lender can give you a better deal.

This flexible loan program includes easier credit qualifying requirements, lower down payments, and lower closing costs.

preapproved-mortgage-loan-house-keysPreapproved Mortgage Loan: The Bottom Line

If you want to successfully find and buy your dream home in today’s finicky real estate and mortgage environment, it is almost mandatory that you have a purchase mortgage pre-qualification letter at the least, and, preferably that you have a preapproved mortgage loan.

Click Here To Get A Preapproved Mortgage Loan