Mortgage Pre-Qualification Process
In a market where buyers compete to put a property under contract, you need mortgage pre-qualification BEFORE you throw your hat in the ring, unless you bring enough cash to remove the mortgage discussion altogether.
What does Mortgage Pre-qualification entail?
A quick 20 minute phone call with a reputable, local lender is a good start. Let them run a credit check, verify assets and income and get back to you with an amount that you would be pre-qualified to purchase up to. Then take a look at the monthly commitment this would require of you and assess your comfort level.
Couple of things to consider after mortgage pre-qualification
- I find that a number of my clients are pre-qualified to buy a lot more house and take on a lot more debt than they are comfortable with, so we step down the price point we are looking at.
- Because overbidding a list price is pretty much the norm in a competitive situation, it pays to look for homes that are 5-10% below your price ceiling and give yourself some room to outbid the competition as needed.
Once under contract, the lender will formalize a loan application and you can expect your mortgage pre-qualification to shift into actual qualification mode. Get ready to supply your pay stubs, tax returns and other documentation to support the income, asset and credit history profile that you gave the lender for mortgage pre-qualification.
Need a Lender Referral?
Choosing the right lender is crucial. This person will be an integral member of our team. They will need to be responsive and a great communicator, to be one step ahead during the process and treat you with respect. IMHO they need to be a good educator (because it’s a complicated field and you need to make informed decisions) and have gratitude for the opportunity to earn your business. You deserve that!
If you or someone you love is looking for a fine lender with high standards, strong work ethic and personal service, please ask me for a referral. I’d be happy to share my short list of local lenders who have consistently out-performed their competition and gone above and beyond to help my clients secure the home of their dreams.