Getting Pre-Approved: Why It Matters

What is Pre-Approval?

Pre-approval is when a lender reviews your financial information and determines how much they're willing to lend you. It's more thorough than pre-qualification and carries more weight with sellers.

Why Get Pre-Approved?

Know Your Budget

Before falling in love with homes, you'll know exactly what you can afford. This saves time and prevents disappointment.

Stronger Offers

Sellers take pre-approved buyers more seriously. In competitive situations, it can make the difference.

Faster Closing

Much of the loan paperwork is done upfront, which can speed up closing once you're under contract.

Identify Issues Early

If there are credit issues or documentation problems, you'll discover them before you're under contract pressure.

The Pre-Approval Process

Documents You'll Need

• Pay stubs (last 30 days)
• W-2s (last 2 years)
• Tax returns (last 2 years)
• Bank statements (last 2-3 months)
• Identification
• Employment information

What the Lender Reviews

• Credit score and history
• Income and employment stability
• Debt-to-income ratio
• Assets and savings
• Down payment source

The Result

You'll receive a pre-approval letter stating how much you're approved to borrow. This letter is typically valid for 60-90 days.

Pre-Approval vs. Pre-Qualification

Pre-qualification is a quick estimate based on information you provide. Pre-approval involves verification of your financial documents and is much stronger.

Tips for Pre-Approval

• Don't open new credit accounts
• Don't make large purchases
• Keep paying bills on time
• Don't change jobs if possible
• Be honest about your finances

Questions?

Reach out if you need help finding a lender or have questions about the pre-approval process.