WHY IS A MORTGAGE PRE-APPROVAL IMPORTANT?
Serious homebuyers should start the process with a lender, not at an open house. As a potential buyer you benefit in several ways by meeting with a lender first and obtaining a mortgage pre-approval letter. This verifies that a lender has checked your credit and verified your documentation to approve a specific loan amount. While a pre-approval doesn't guarantee you will get a mortgage, being pre-approved does have some advantages, which include:
- It gives you confidence in your search. When you know how much mortgage you can afford, you can look for houses within your budget.
- It accelerates the loan process once you make an offer because your lender has most of your financial information.
- It shows home sellers that you have your finances in check and that you are serious about buying a house.
APPLICATION CHECK LIST
- Driver's License or US Passport
- Social Security Number
- Names and addresses of employers for the last 2 years
- Paystub for most recent full month with year to date earnings
- W-2 Form(s) for the last 2 years
- Personal and business federal tax returns for the last 2 years
- Assets and Liabilities
- Statements for checking/savings, 401(k), money markets, etc.
- Documentation for any recent large deposits in accounts
- Most recent statement for current mortgages (if applicable)
- Special Situations (if applicable)
- Bankruptcy papers (petition, discharge and schedules, letter of explanation)
- Divorce: Final judgment and marital settlement agreement
- Judgment or lien on your assets
- Child support history showing no arrearage
- Letter of explanation regarding all late payments and recent inquiries
PRE-QUALIFICATION vs PRE-APPROVAL
A mortgage pre-qualification can be useful as an estimate of how much you can afford to spend on your home, but a mortgage pre-approval is much more valuable because it means a lender has checked your credit and verified your documentation to approve a specific loan amount. The final loan amount is approved when you have selected a property and an appraisal has been completed to determine the value.
WHY GET PRE-APPROVED at BANK OF LAKE MILLS?
Loans are subject to approval. Bank of Lake Mills NMLS #460552.