Obtaining Your Mortgage Pre-Approval
The most important aspect of the mortgage process is determining how much home you can afford to purchase. This will be the driving force of your home search. Be prepared to provide a detailed summary of your economic life for the past 2 years.
Once in contact with your mortgage consultant, she will ask you for some basic information to complete the loan application. This will include questions about your employment and residency for the past 2 years, and your current income and assets. If you are purchasing a home, she will need to know the amount of your down payment.
Your mortgage consultant will then pull a tri-merge credit report that will reveal your 3 credit scores from TransUnion, Experian, and Equifax. She will use your middle credit score to qualify you for specific loan programs and determine your interest rate. In this current mortgage market: the lower your credit score, the greater the potential you’ll receive a higher interest rate. Credit scores range from 300 to 850, with the best rates given to scores above 740.
The mortgage consultant will run your credit, income, and asset information through an automated underwriting process. The automated underwriting process will produce a general loan approval or a loan decline based on the information provided at that time. The loan approval will be subject to specifics such as appraisal of property, title search, change or loss of employment or assets, and verification of funds for down payment.
This process will help you establish the price range of homes that you will be comfortable shopping in. It is helpful to be completely informed of your mortgage choices from the beginning, so that there are no surprises down the road.
If you’d like to find out what your borrowing power is for a new home, please contact me at bahale1@gmail.com or call (513) 520-6044.
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