How to Get Pre-Approved For a Mortgage in 5 Simple Steps

What is a Mortgage Pre-Approval?

A mortgage pre-approval is a conditional, preliminary approval for a mortgage. It’ll include an estimated interest rate and a maximum amount that the bank is willing to loan you. Most sellers require the buyer to have a mortgage pre-approval letter from a lender before they’ll sell them the property, along with proof of funds. These letters are also often marketing tools used by lenders, as buyers shop around for a mortgage. Approval letters are usually valid for 60 to 90 days.

So how do you get Pre-Approved?

Getting pre-approved for a mortgage is an important first step when you're planning to buy a home. It gives you a clear understanding of how much you can afford and helps you focus your home search. It also shows sellers that you're a serious buyer and can make your offer more competitive. Here are the 5 steps for getting pre-approved for a mortgage:

1. Find a lender - Look for lenders that offer the best rates and terms for your needs. You can do this by contacting different banks and mortgage companies, or by using an online mortgage platform. 
2. Gather your financial documents - You'll need to provide your lender with proof of your income, employment, assets, and debts. This includes items such as pay stubs, tax returns, bank statements, and credit reports.
3. Complete an application - Once you've found a lender, you'll need to fill out a mortgage application, which will ask for your financial situation as well as personal information like Social Security number. This is typically an online process, but you may also be able to do it in-person.
4. Wait for the lender to review your application - The lender will review your financial information and credit score to determine if you qualify for a pre-approval and the total pre-approved amount. This process can take several days or a week.
5. Receive your pre-approval letter - If you're approved, you'll receive a pre-approval letter from the lender. This letter will include the estimated interest rate, the maximum loan amount, and the terms of the loan. This letter will also be valid for certain period of time, which is generally between 60-90 days.

Summary

Getting pre-approved for a mortgage is the first step in the home buying process. With a pre-approval letter in hand, you can start your home search with confidence, knowing how much you can afford and that you're ready to make an offer when you find your dream home.

You can reach out to hunter for lender recommendations, additional guidance, or a hand-holding experience throughout the home buying journey!

Reach out to our homebuyer advisors at LocalizeOS who work directly with our partner agents and their homebuyers to help expedite points in the home buying process such as working with lenders to get approved for a mortgage. Contact us at hello@localizeos.com for more information.