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What Does It Mean to Be Pre-Approved for a Mortgage?

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December 17, 2019

What Does It Mean to Be Pre-Approved for a Mortgage?

When pre-approved for a mortgage, a lender has looked over your finances and determined how much money you can borrow, how much you can pay per month, and what your interest rate will be. A pre-approved mortgage is not a guarantee that you’ll secure a loan for your potential home, but it can help you be a more competitive buyer.

Why Should You Be Pre-Approved? 

Having a pre-approved mortgage leaves out some of the guesswork when searching for your dream home. It can help you set a clear price range and narrow down your choices. Sellers may be more willing to negotiate with you or may even expect a pre-approval letter during the sales process. A pre-approved mortgage also helps you stand out in a competitive market.

What Documents Do You Need?

Make sure to gather all necessary documentation before meeting with your lender. To start the process, you'll need W-2 wage statement forms reporting your income from the past two years. You'll also need documentation to prove your:

  • Identity
  • Credit score
  • Bank and asset statements (i.e., 401K, IRA, stock accounts)
How Do You Get Started?

It’s best to consult with a mortgage expert before you begin the home buying process. Make sure that your finances are in a solid spot before applying for a pre-approved mortgage—you've paid down your outstanding debts, your credit score is within a good range, and you've been steadily employed for at least two years. Keep in mind that mortgage pre-approval letters usually expire after 90 days, so make sure you’re serious about moving forward before you speak to a lender.

Robertson Homes has partnered with the area's best lenders who are dedicated to helping you navigate the mortgage pre-approval process. Call us at (248) 657-4968 or fill our form to get one step closer to finding your new home in the Detroit area.

What Our Homebuyers Are Saying

This was my second new home in Orion Village. Virginia (in sales) was again a joy to work with. The construction supervisor Jeff was also great. He volunteered to provide his phone number and email and was always extremely helpful.

A Satisfied Homeowner | Orion Village

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