While it's true that mortgage lenders are tightening the purse strings, home loans are still out there and readily available to those who qualify. The only way you will know if you do qualify is to seek a mortgage pre-approval.
A mortgage pre-approval will help:
- confirm your eligibility for a home loan
- establish a price range
- give you confidence in the home buying process
- reassure home sellers of your ability to secure a loan
Your loan application information will be the basis for your mortgage pre-approval. Lenders will also weigh heavily three credit reports and income verification. Before you shop for a mortgage pre-approval, review your own credit history. Determine what you can comfortably afford to pay for housing including taxes and insurance.
Before you visit a lender, or fill out a loan application, check your credit report for potential problems. Your credit score will help determine whether or not you get a loan, the terms of the loan and the interest rate you will pay.
Federal law entitles you to one free credit report in a 12-month period from each major credit reporting agency. Get a free report at www.annualcreditreport.com. Check the report for errors and resolve errors before you apply for a loan. You can also call the three major nationwide consumer credit reporting companies for your free report:
- Equifax: 1-877-576-5734; www.equifax.com
- Experian: 1-888-397-3742; www.experian.com/fraud
- TransUnion: 1-800-680-7289; www.transunion.com
Mortgage Pre-approval vs. Mortgage Pre-Qualification
A mortgage pre-approval is not the same as a mortgage pre-qualification. Many people confuse the two terms. A mortgage pre-qualification is the first step to getting a mortgage pre-approval.
During the mortgage pre-qualification process, a mortgage lender will evaluate your financial status based on information you give over the telephone or internet. It does not usually require an application fee or require you to substantiate income and expense claims. The lender will determine how much you are likely to be able to afford for housing. It is important to be completely honest with your lender and yourself during this process.
A mortgage pre-approval is more formal. It will require fees including an application fee and a credit report fee. You will be asked to provide documents to verify employment or other forms of income. The mortgage lender working on the mortgage pre-approval will pull your credit reports and review your credit history. Mortgage pre-approval is a better guarantee of your eligibility than a mortgage pre-qualification.
Mortgage Pre-Approval Gives You Bargaining Power
Home shoppers are often disappointed when they are turned down for a loan. Home sellers suffer too when their intended buyer is not able to secure a loan. Sellers are wary of buyers who may not qualify for a home loan. A mortgage pre-approval will give you bargaining power.
Our company has a vast network of lenders and other real estate transaction support services. Contact us today for help getting pre-approved for a home loan.
Troy Batson ~ Broker
Duke Warner Realty
1033 NW Newport Ave
Bend, Oregon 97701
541.678.3725 or 541.382.8262
troybatson@dukewarner.com
troybatson.com
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Mortgage Pre Approval