Whether you are purchasing your first home or investment property, the most important first step is to get Pre-approved
Here are a few things you might want to know:
What is a pre-approval? Why is it important?
Before spending time on searching for the perfect home to purchase, it is important to know how big of a loan you can qualify for, and what the housing payment will look like (unless you are purchasing all cash and don’t need a loan). This is where Pre-approval comes in play.
Pre-approval is the process of determining how big of a loan you can or want to qualify for. There is no fee and no obligation. The pre-approval is designed to protect you to ensure you can obtain the financing you will need when you make an offer on a home.
We will ask you for a list of personal information including supporting income and asset documentation. The info and supporting documents will be reviewed and based on the lenders’ guideline, we will determine the maximum loan amount you can qualify for and the estimated housing payment.
What do I need to get pre-approved?
We will need the following list of information and documents for each individual whose income and
asset will be used to qualify for the loan:
Name on the loan and title
Date of birth
Primary home address for the past 2 years
Primary employer name, address, contact info and job title for the past 2 years
For those receiving a salary, we will need latest paystubs covering a month, most recent 2 years W2 and personal federal tax returns.
For those self-employed on 1099, we will need most recent 2 years personal and corporate federal tax returns.
For those self-employed that pay themselves salary, we will need latest paystubs covering a month, most recent 2 years personal and corporate federal tax returns.
7. Asset documentation
latest 2 months bank statements showing the source of down payment
latest 2 months statements for other saving/checking/retirement account that can show that you have money left after purchasing the home.
If you own other real estate, we will need market value, loan balance, current rent, lease agreement, recent mortgage statement and home insurance.
Will you pull my credit?
We will not pull your credit without your permission. This is the last step we do to finalize the pre-approval. If you already have an existing recent credit report, we will be happy to use it.
Pre-qual vs Pre-Approval
Pre-qual is just a simple verbal check on roughly what loan amount you can qualify for by obtaining your income $ amount and your saving $ amount for down payment and reserves. Please keep in mind that the lenders’ guideline is very peculiar when it comes to interpreting your income. Not all income can be used to qualify for the loan. The type of income and consistency of income are both taken into account when qualifying for a loan. That is why Pre-approval is far more superior and reliable in protecting you and ensuring you the ability to get the financing you need to purchase a home.
Does a pre-approval expire?
The pre-approval we issue does not have a firm expiration date. After the pre-approval is complete, we urge you to contact us each time before you write an offer on a home. We will ensure that the pre-approval is still valid at that point. However after the pre-approval, if you change job or your income changes or your savings amount change, please do reach out to us and let us know.
The Purchase Process
After you are pre-approved, the home searching process begins.