Getting preapproved for a mortgage is an essential part of the home-buying process. While it’s possible to wait before securing your financing, there are major benefits to getting preapproval early.
For more information about preapproval, here are the basics to consider:
When to get preapproval
It’s recommended that would-be homebuyers obtain a preapproval letter from a mortgage lender as soon as possible in their buying process. The earlier you take care of this important step, the earlier you’ll know exactly how much money you can afford to spend on a home. This can help you narrow down your home search.
Why get preapproval
In addition to helping your home search, getting mortgage preapproval also shows sellers you are a qualified buyer. Preapproval requires a careful examination of your financial situation, including factors like debt-to-income ratio and liquid assets.
Going through the process confirms your eligibility for a mortgage and communicates to sellers that you’re less likely to back out of a sale.
How to get preapproval
Compare mortgage lenders to find the best fit for your needs. You can request a loan estimate and mortgage preapproval letter from a lender after providing essential documentation like investment account statements, bank statements, pay stubs and credit report.
If you intend to buy a home, it’s a good idea to get preapproved for a mortgage sooner rather than later. The more prepared you are with your finances, the more effective your home search will be.
About the Author
Bob Hummer
Bob Hummer brings a wealth of experience with him; a practitioner in real estate in Northern Virginia since 1978, a Life Member of both the Million Dollar Sales Club and the Top Producers Club with over 2,500 Satisfied Families and President, Prince William Association of REALTORS in 1991. His experiences range from helping buyers and sellers attain their goals; to renovating historic homes on Capitol Hill; to counseling and assisting homeowners facing the loss of their home due to foreclosure. Since 1996, he has presented his free monthly Home Buyer and Home Seller seminars at the Woodbridge campus of Strayer University. In June 2023 he completed the Certified Probate Real Estate Specialist course and was awarded the designation CPRES. His goal is to assist individuals who inherited real estate and wish to sell. A former "Military Brat" and a retired Air Force Hospital Administrator, Bob has made more than 26 moves during his life and is extremely familiar with all aspects of a family relocating - whether it is across the street or across the nation.