Blogging About Loans: Be preapproved for a home in Castle Rock, Colorado

An office of elite mortgage lending professionals with a common interest and goal focused on providing customer service that exceeds expectation. Thereby building our business from repeat and referral opportunities. Ruth Vogt. LMB 100023827. NMLS 257576. Regulated by the Division of Real Estate. Fairway Independent Mortgage is an Equal Housing Opportunity.

Be preapproved for a home in Castle Rock, Colorado

Be preapproved for a home in Castle Rock, Colorado.

Whether you are renting or just thinking about a new home, the first step is to be preapproved for a home before you ever start looking for the home! First, you need to know what a preapproval means, and then I'll give examples on why you need to be preapproval for a home in my next post.

Many lenders and real estate agents will ask you to at least be prequalified before you start your search for a new home. While that's a good start, it's not enough! A prequalification merely indicates that your credit has been pulled, and your income is sufficient to qualify for a maximum monthly payment based on your verbal disclosure. To be preapproved for a home, however, a formal income analysis can get a little tricky. Not all income is always considered acceptable income for the purpose of obtaining a final loan approval. In order to actually be preapproved for a home, your income will be scrutinized to assure a minimum of a two year history in the same line of work has been established. Also, the income must continue usually for three years. When commissions, bonuses, overtime, etc, is being used, there must be an acceptable history of such. To be preapproved for a home means your source and breakdown of income has been examined by an underwriter.

The next step to be preapproved for a homeis to have your liquid assets reviewed. Even if you are obtaining a no down payment loan such as a CHFA loan, lenders may want to see that you have "reserves" or excess funds remaining after closing to cover unforeseen housing expenses should they arise. Copies of bank statements are usually provided to show you have sufficient liquid assets. Sometimes a review of the bank statement may trigger additional questions by the underwriter. If so, it's wise to provide explanations right then in order to to be preapproved for a home before you go shopping for one.

And even though I mentioned the credit report review, there are so many things on a credit report that one set of eyes might miss when the goal is to be preapproved for a home and not just prequalified. Depending on personal circumstances there may be additional documentation that may be requested to be preapproved for a home that might not be asked when simply being prequalified. Once you get the paper work out of the way, you'll be able to enjoy the hunt for your perfect home!


Opinions expressed here are the sole responsibility of the author, and do not necessarily reflect the view of Fairway Independent Mortgage.

Ruth Vogt Colorado Mortgage Lender Ruth Vogt, Sales Manager

 #LMB100023827, NMLSR# 257576

 Equal Housing Opportunity. 

 Regulated by the Division of Real Estate.

   www.ColoradoHomeLender.com

   ruthv@fairwaymc.com  303-881-7849.

 

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Comment balloon 2 commentsRuth Vogt • March 24 2010 09:33PM

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Great hyper-local blog.

Way to be creative from the mortgage side!  I'm going to copy the concept if you don't mind:)

Posted by Loan Survivor Real Estate Financing Expert (Purchases, First Time Buyers, Pre-Approvals, Refinance) over 8 years ago

Drew, what a great compliment! Of course I wouldn't mind!

Posted by Ruth Vogt, 719-592-0855 Apply 24/7 www.ColoradoHomeLender.com (Fairway Independent Mortgage, LLS. Equal Housing Opportunity. Regulated by the Division of Real Estate.) over 8 years ago

Participate