How to Get a Preapproved Mortgage

Getting a preapproved mortgage can provide you with some comfort when you are shopping around for a house. This way, you know that you are already approved for a certain amount of money and you do not have to worry anymore. Here are the basics of how to get a preapproved mortgage successfully.

Get Your Documents Ready

In order to get preapproved for a mortgage, you are going to have to provide your lender with many different financial documents. In order to speed up the process, you should gather these documents up before you talk to a lender. Otherwise, you will have to stop the process and go find your financial documents before you can move on. You are going to need to provide them with your W-2 statements for the last two years. You are also going to need to give them your federal tax returns for the last two years. You will also need to get copies of your bank statements for at least the last two months if not longer. Bring some recent pay stubs so that you can prove how much money you make. If you are a regular investor, you will also need to provide them with proof of any investment income that you bring in.

Shop Around

When you are trying to get a preapproved mortgage, you should shop around with several different lenders. You do not want to tie yourself down to one particular lender because you will not know if you are getting the best rate. You need to look at a few different lenders in your local area as well as check out lenders online. Ask them about their interest rates as well as closing costs on the mortgage.

Application

You will need to fill out an application with the lender that you choose. This process usually takes 20 to 30 minutes if you have all of your documents in hand. They are going to ask you a lot of personal information as well as financial information. You will need to provide them with your name, your address, contact information, your Social Security number, and other important information.

Credit Check

After you have filled out your application, the lender is going to run a credit check on you. They are going to pull your credit file and evaluate it for any potential problems. During this process, they are going to look at your credit score as well as your payment history with all of your accounts.

Income Verification

After they have looked at your credit, they will want to verify your income as well. They will call your employer to make sure that you are currently employed. Once they have verified your income, they are going to compare it to your debt load. This will give them a debt to income ratio to work with.

Approval

After the bank is satisfied that you are a worthy borrower, they will notify you that you have been preapproved. At this point, you can continue shopping for a house.

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