What is a Mortgage Pre-Approval?
Getting Pre-Approved is the process of determining how much money you will be eligible to borrow before you apply for a loan. You should obtain a pre-approval from a qualified lender before beginning your home search in order to determine your mortgage qualification and address any credit issues before you find your dream home.
Why do I Need a Pre-Approval?
At Fairway, we issue a valid pre-approval which includes a 360 degree evaluation of your financing ability, including income and asset documentation, and a thorough credit review. This is important because the more accurately we can analyze income, assets and liabilities, the more accurately we can determine the amount and type of loan you can qualify for.
When Should I Get Pre-Approved?
It is never too early to get a pre-approval. It is valid for 90 days at which point they will need to be renewed with updated financial documents. In the meantime, you have the opportunity to address any issues that may be revealed in your credit report, such as a disputed account.
While a disputed account may or may not impact your ability to qualify for the loan it will impede your ability to close the loan. Disputed accounts are time consuming to resolve, and may result in a delayed closing if not addressed beforehand.
Will Getting Pre-Approved for a Mortgage Impact my Credit?
There are two types of credit inquiries: hard inquiries and soft inquiries. When getting pre-approved for a mortgage, lenders generally pull your credit as a soft inquiry. This will not impact your credit score.
However, once you find a home and complete your mortgage application, a hard credit inquiry is pulled with the three main credit bureaus to ensure your credit is in good standing. A hard inquiry may or may not have a small impact on your credit score, depending on your credit history and number of accounts.
How Can I get Pre-Approved for a Mortgage?
Obtaining a pre-approval is a straightforward process. At Fairway, it can be done in three easy steps.
- 1. Fill out a short online application
- 2. Send the required financial documents through our secure, encrypted system
- 3. Review all information with a loan officer, and then the pre-approval is issued.
In our competitive market, this is the single most important first step on the road to home ownership. Be sure you work with a lender that does it the right way!