Thinking of buying a house? Then you probably want to consider getting pre-approved for a loan. Pre-approval is when a lender has confidence you can make a down payment of a certain amount and that your income is enough to make the monthly loan payments. There are a lot of good reasons to seek pre-approval, and some steps you’ll have to take to get there. Here’s what you need to know.
What You’ll Need
Getting pre-approved for a home mortgage requires you to provide personal information found on certain documents*. The following are examples of the types of documents you may need:
• W-2 forms from the previous two years
• Paycheck stubs for the previous three months
• If self-employed, business tax returns from the previous two years
• Tax returns from the previous two years
• Bank statements for the past three months; checking or savings
• Statement of all other assets for the past two months
• Current mortgage documents, or landlord information if renting
What You’ll Do
Simply contact your Axiom Financial mortgage consultant to start the pre-approval process. A pre-approval usually takes a couple of days to process, as long as you provide your lender with the necessary paperwork.
This paperwork will be used to prove your income and assets, allow credit to be pulled and reviewed, and verify your employment. Pre-approval is important, as it determines how much money you qualify to borrow from the lender.
What You Get
Being pre-approved will give you an accurate idea of what you could receive for your loan. This will be important in the home searching process. It will give you a better idea of what to look for in a home and what you can realistically afford.
Pre-approval will also be useful when you want to make an offer on a house. An offer with pre-approval letter is more likely to be taken seriously than an offer without one. In some circumstances, a pre-approval letter is necessary to even make an offer. Your real estate agent is likely to want to see a pre-approval letter as well before they get really serious about the home searching process with you.
*Any changes to information you supply for pre-approval may void your pre-approval and loan options at any stage of the loan process.