Acquiring a mortgage is an integral step in the home-buying process. Not only does it give you an idea of how much house you can afford, but it also signals to sellers and real estate agents that you are serious about making an offer on a property.
When seeking a conventional or FHA loan, the key to getting preapproval is understanding your credit and income situation. From there, you can focus on finding a lender who provides mortgages within reach that fit within your budget.
How to Acquire a Mortgage Approval in Less than 5 Minutes
One of the fastest ways to get approved for a mortgage is through an efficient application. This application allows you to compare multiple loan options from several lenders without impacting your credit score or increasing the likelihood that you will be turned down.
You can complete the form online and submit it by email or over the phone. Afterward, your preapproval will be processed within three business days.
How to Receive Mortgage Preapproval in Less than Five Minutes
Before your lender will approve you for a mortgage, they will review your credit report and financial documents. They want to confirm that you are responsible and will pay back debt on time; thus, paying down debt, saving for an down payment, and avoiding late payments or defaults on existing loans are all key steps in getting approved.
As a self-employed borrower, lenders may require additional paperwork such as two years of tax returns and financial statements from your business. They also want to verify your income is reliable and predictable in case of short sale or foreclosure proceedings.
The lender will also pull your credit report to assess your credit history. With a good score, they may offer you a more favorable interest rate and reduced closing costs.
It’s worth noting that you can save a considerable amount of money by comparing rates and fees from several lenders before getting preapproved. Doing this may result in an improved deal on your mortgage, possibly even getting you the lowest rate available.
Getting Preapproved for a Mortgage
Once you’ve been preapproved by the lender, they’ll issue you a preapproval letter that outlines how much mortgage you can afford. This letter contains details such as the type of loan, estimated interest rate and other terms. It may also include your loan application form along with documents like an appraisal for the home you wish to purchase.
Becoming Preapproved for Purchasing a Home
The mortgage application process can take weeks, if not months; thus, getting started as soon as possible is key. Being preapproved helps you make an attractive offer on a house and expedites the entire procedure.
Although a credit score of at least 620 can get you preapproved for a mortgage, it’s recommended to aim higher. Your credit score plays an important role in how much money you can borrow and the interest rate offered on a loan.