All Posts tagged Pre-Approval

During the real estate boom a couple years ago, getting a mortgage was ridiculously easy.  In hindsight, it was a chicken or egg thing.  Nevertheless, times have changed.  Buyers now are forced to jump through hoops and promise their first born prior to being approved.  Seriously though, starting the pre-approval process earlier rather than later is definitely the best route to pursue.

The first hoop in the process of obtaining a mortgage loan is getting pre-approved.  That means that the lender has verified that based on their initial assessment, they will loan you a certain amount of money for a certain length of time.  They will then issue a letter stating as much, which you will need to include when you submit an offer on a home.  In today’s market, sellers and agents are more likely to require a pre-approval letter.  When taking La Quinta homes for sale into consideration, qualified buyers will appear more serious when they have taken the correct steps to obtain financing.  The following are some ideas of how to go about today’s mortgage process.

Start early and shop around

Prior to looking at La Quinta Real Estate, it is generally good to talk to two or three different lenders.  They will likely be very comparable on price and terms, so talking to more than that is not necessary.  What you are looking for is a mortgage package that best fits your needs.  Another thing to consider is what it would be like to work collaboratively with each lender you talk to.  As the loan progress moves forward, you will be having near daily conversations with this person, so make sure that will work for you.

Do you homework

The lender is going to need extensive documentation of your income, assets, and commitments.  What they are evaluating is your ability to repay each month.  In the wake of the lending crisis, requirements have gotten much more strict.  Be prepared to give the lender copies of your W-2s, tax returns, investment income statements, child support and or alimony documentation, recent paystubs, and any other income documentation you may have.

Know that you are not locked into any one lender

Just because you are pre-approved with a lender does not mean you have to complete the loan process with them.  Rates change daily, so the rate the day you are approved will most likely not be the same when you find a property and lock in your loan.  If something changes that you are not comfortable with (loan type, rate, etc.), you are free to change lenders at anytime.  That being said, changing once you are close to closing will likely delay the transaction.

Watch your credit

Just like any other type of credit inquiry, shopping for a mortgage can ding your credit a little bit.  But, models typically ignore home and auto inquiries within 30 days of the score.  So, comparing lenders will not harm your score.  Remember that your lender will check your credit again right before closing.  So, even though it is exciting to think about buying all that furniture for a new house, it might be best to wait until everything is finalized before making any purchases that would affect your credit score.

Keep timing in mind

Once your rate is locked in, you usually have 30 or maybe 60 days to get the transaction closed.  Generally that is not a problem.  But, keep this in mind if you are going to be out of town during that time, or have something else that comes up.  When your lender requests documentation from you, try and accommodate the request as quickly as possible just to keep things moving.  If rates have gone up and your lock expires, there is really nothing that can be done.

In La Quinta, there is a wide variety of lending options, from major national banks to smaller local ones.  Make sure and deal with somebody that you trust.  In a lot of situations, having someone you can meet with face to face can be helpful, so be wary of the amazing low rates you may see offered by on-line lenders.  In summary, by doing a little bit of prep work upfront, you can save yourself time and money, and ensure a smooth transaction.