There are two primary benefits to getting pre-approved for a home loan. The first benefit is becoming a better prospective buyer. A seller is going to prefer someone who is pre-approved for an amount than someone who is still negotiating with a lender. The second benefit is knowing your price range. Your pre-approved amount helps you filter your pricing options for a house.
CHECK YOUR CREDIT SCORE
The first thing you want to know is what your credit standing is. Not only do you want to know your number, but you will also want to make sure it is accurate. There may be some erroneous information on there—like a debt you don’t owe. Contact the credit bureau immediately to get it resolved. While you are at it, you may want to work on improving your score as well. The best way to improe your credit score is to pay down some of your debt.
GET THE PAPERWORK READY
In order to get pre-approved you will have to provide information to your mortgage lender. This information includes your income, assets, and debt. Make sure you have all the documents below to make the pre-approval process easier.
The documents and information you’ll need:
- Pay stubs that show your year-to-date income
- Two years of tax returns
- Two years of W-2 forms
- Statements that show your asset accounts, which might include checking, savings, CDs, IRAs, stocks and bonds
- Your residential history for the past two years
Pre-approval is a worthwhile process when shopping for a new home. It is important to note that the pre-approval is an estimate, you may not get the full amount of the approval, but it is a valuable tool you can leverage when approaching the seller of a home.
Stonebridge Mortgage Group can help you with your pre-approved loan for a mortgage. We serve the greater Portland area and are in Gresham, Oregon.