Understanding the Mortgage Pre-Approval Process - Mortgage Guys
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Understanding the Mortgage Pre-Approval Process

If you are in the market for your first home or wish to purchase a new home, you will be required to complete a number of steps in order to secure a mortgage. One of the best options to consider today is mortgage pre-approval. A pre-approved mortgage application will help you in your search for a new home. With pre-approval, you know exactly how much you can spend on a home and you are able to lock in an interest rate. You will be ready to begin your search and easily be able to make an offer and begin a contract with pre-approval for your next home mortgage.

How Pre-Approval Works

When you fill out a pre-approval application, you are taking the next step in the process of buying a home. Your mortgage lender will be able to guide you through this process, helping with financial strategies as well as figuring the mortgage amount, down payment, working on purchase price, etc. You will learn valuable information in the pre-approval process including the difference between a fixed and variable rate, payment options, interest terms, amortization and more. Discuss with your lender what you can do to get the best mortgage for your home needs.

The application process will include personal information including financial history and credit rating. You will need to include information from your employer as well as any assets, income, down payment and liabilities. A credit report will be requested to learn your credit score which can be helpful in securing a lower interest rate on your monthly payment. Documentation may be required, with your lender informing you of what should be supplied once approval is given.

Why be Pre-Approved?

There are many benefits to the pre-approval process. To begin, you will save time as you search for your home as you know exactly how much you can afford to spend. You will also have an idea as to what your monthly payment will be and how much will be required for you to put down as your down payment.

Real estate agents will know that you are serious about purchasing a home if you are pre-approved. This will gain trust in real estate agents and get you the help you need in finding your new home. The seller will also take you more seriously as they will know you really want to buy their home, especially since you have financial backing. You also will have power to negotiate since you have been pre-approved.

A rate lock will also be provided by certain lenders which means you can expect to keep this rate while you search for homes. This can be key to securing a low monthly payment for your next mortgage. You are also not obligated to purchase a home with pre-approval.

Overall, pre-approval is a win/win situation. At Mortgage Guys, we want to get you pre-approved so you can quickly begin an informed search for your new home. Contact our office today to learn more about how you can become pre-approved and let our lending team find you the right mortgage for your new home needs.