The Importance of a Pre-Approval


A pre-approval is necessary to know how much you can afford before you begin your home search. This way you will only look at homes in your specific price range. A pre-approval is also important to make a confident offer.

What Is A Pre-Approval?

A mortgage pre-approval occurs when a lender agrees to lend you a specific amount of money before you have found a home. To apply for a mortgage, you will first fill out an application. A complete review of your credit history is performed and the information you have provided is validated. Based on this information, the loan can be pre-approved.

How Do I Get A Pre-Approval?

Fill out a residential mortgage application with a target loan amount and sales price with your lender. These amounts may change as you continue to search for a property but it is important to establish a starting point. Regardless of the type of mortgage you choose, your income and down payment sources will need to be verified. This entire process typically takes 7-14 days.

What Documents Do I Need?

  • Your W2 from the past two years
  • Your pay stubs for the past three months
  • Your tax returns from the past two years
  • Your checking or savings bank statements for the past three months (this will likely show your down payment funds in them as well)
  • Your statements for all your other assets (stocks, bonds, retirement accounts) for the last two months
  • The name & number of your landlord or your current mortgage documents
  • Your divorce decree, if applicable
  • If you are self-employed: Business tax returns for the past two years with your year-to-date profit and loss statement, and year-to-date balance sheet
  • Credit Report and Credit Score (the lender can run this for you)