Mortgage Pre-Approval

Why You Need a Mortgage Pre-Approval 

Now that Summer is here, you may be thinking about buying a home. Once way to put yourself in a good buying position is to obtain a mortgage pre-approval.

What is a Mortgage Pre-Approval?

A mortgage pre-approval is an offer by a lender to loan you a certain amount of money under specific terms. A pre-approval demonstrates to real estate agents and sellers that you are a serious buyer, and that you have the means to purchase a home.

  • Establishing Your Budget: A pre-approval helps you understand how much you can borrow and what you can afford, allowing you to focus your home search on properties within your financial reach.
  • Strengthening Your Offer: In competitive markets, a pre-approval makes your offer more appealing to sellers, as it demonstrates that you have the financial means to complete the purchase. This can be a decisive factor in multiple-offer situations.
  • Saving Time: Having a pre-approval can expedite the buying process by allowing you to make offers more quickly and ensuring that you have all necessary documentation ready when you find the right home.
  • Better Negotiation: Sellers are more likely to negotiate with buyers who are pre-approved because it reduces the risk of the deal falling through due to financing issues.

For these reasons, we recommend obtaining a pre-approval as soon as you start seriously looking at homes. It not only streamlines the homebuying process but also positions you as a serious and qualified buyer in the eyes of sellers and real estate agents​.


How to Prepare for a Mortgage Pre-Approval

To Get Ready for the Pre-Approval Process:

  • Compile your financial information, including financial accounts, tax information, and other personal information.
  • Determine your debt-to-income (DTI) ratio, which is the percentage of gross monthly income that goes toward debt payments. This includes credit cards, student loans, and car loans. Many lenders want to see a potential homebuyer’s DTI under 40 percent.

Once you have your finances in order, look for a lender that has a solid reputation, is upfront about all fees, and is open about how long the mortgage process will take.

Should You Review Your Credit Report Before Talking to a Lender?

Yes. To qualify for a mortgage pre-approval, a lender will pull your credit report and review documents to verify income, assets, and debts.


To avoid surprises, you can request your own free credit report annually from each of the three credit bureaus – Equifax, Experian, and TransUnion – at


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