How to Get Pre-Approved for A Mortgage

Before you begin your new home search, talk to a lender about getting pre-approved for a mortgage. This critical step can save you time in negotiations and keep your search on target and within budget. What exactly is a pre-approval, and how do you get one?

A pre-approval is different than a pre-qualification because it is more thorough. A pre-qualification can serve a similar process, but because the lender does not pull your credit to provide a pre-qualification, the actual amount might end up being off from your final approval amount, especially if your credit is low. If you are just casually looking, a pre-qualification letter may be all that you want to do right now. But if you have serious plans to make an offer and purchase a home at the end of your search, going through the additional steps to get a pre-approval letter can make the entire process smoother.

To get a pre-approval, start by finding a reputable lender that you want to work with to purchase your home. This can be a bank, credit union, or private lender. Ask friends, coworkers, neighbors, and family for recommendations. Once you have someone that you want to work with, ask them what they need from you to provide a pre-approval. Expect to give them the following information:

• An application
• Authorization to pull your credit
• Supporting financial documents, such as pay stubs or W-2s
• Information about outstanding debts, such as student loans, car loans, or credit card debt