Mortgage Glossary
What is a mortgage pre-approval?
It is a letter or documentation from a lender stating that based on pulling your credit and looking at your tax returns they will lend you a certain amount. It is not a full approval because you must first identify a property.
Why do I need a pre-approval?
First and most importantly to make sure that you can purchase the home that you want and that you are looking in the right price range.
Secondly, when you do find a home you wish to purchase, your Realtor wants to be able to represent you as a strong Buyer. In this competitive market the pre-approval may be your edge in securing the home you want.
Does a pre-approval cost me anything?
Generally not unless the lender charges a small fee for pulling your credit.
Where should I get this pre-approval?
If you already have a relationship with a Lender get it from them. If not, ask your Realtor for a recommendation. We discourage working with internet banks and out of area banks.
If I get a pre-approval from a Lender do I have to use that Lender for a mortgage?
No, you do not. However, if they have done a good job for you in the preliminary counseling stages we would suggest staying with them.
