- What is mortgage pre-approval?
Mortgage pre-approval is an evaluation by a lender that determines if you would qualify for a home loan. It also shows how much the lender would be willing to lend you. Getting pre-approved is the first step towards getting a mortgage, but it does not guarantee a loan. Your pre-approval letter should be submitted along with your offer to show sellers that you are a serious and qualified buyer.
- How to get pre-approved for a mortgage?
The first step to get pre-approved for a home loan is to connect with my premier lending partner to work with you. Then the lender will ask for some basic information about your financial history and will need to run a credit report. If you meet the lender’s guidelines for issuing a loan, he or she will issue you a pre-approval letter, which states the home loan amount the lender is willing to let you borrow.
- What Credit score do I need?
FHA loan, applicants are now required to have a minimum FICO score of 580 to qualify, however many lender require a 640 score for better rates, a 620 credit score is also acceptable. Generally the higher the score the smoother process.
- How much money do I need?
FHA loan require a low down payment, which is currently at around 3.5 percent. Ask your lender/loan officer about Down Payment Assistance. Second you will need money for Trust/Earnest Money or a Deposit during the time you submit an offer to purchase. The amount can vary for $500 – $1000 or even more depending on the purchase price and seller. Third you will need money for Inspections such as home and termite which could range from $375 to $500. Your lender/loan may require you to pre-pay for an appraisal, ask your loan officer if this is required.