You are ready to purchase your dream home, so what is next?
What is Pre-qualification?
Pre-qualification starts the loan process. Once a lender has gathered basic information about a borrower’s income and debts, an opinion can be made as to how much the borrower should qualify for in purchasing a house. Since loan programs vary between credit, debt and down payment requirements, borrowers should get pre-qualified for each loan type that they qualify for and are considering.
Being pre-qualified is only a limited analysis and does not hold a lot of weight when it comes to negotiating a contract or reassuring a seller. There are many aspects to fully qualifying that could change a borrower’s ability to qualify for a mortgage. Some of these things are: credit, length of employment, type of income, debt, liens or judgments, property type or condition and other issues that will be brought up during the approval process.
Although it is tempting to start your home search prior to getting a pre-approval, we suggest you get that step completed sooner than later so you are armed with the knowledge of your real shopping budget and the power to negotiate the best deal.
What is a Pre-Approval?
Being Pre-Approved lets you know your price and term limitations and therefore removes some of the stress of finding the perfect home.
Being pre-approved also empowers you during the negotiation process. It gives the seller confidence in knowing your finances are one less aspect of the transaction they need to
worry about. You’ll need a pre-approval to bid on a bank owned or short sale home. Your offer won’t even be considered if there are several offers on a home if you don’t have a pre-approval.
A pre-approval gives the seller assurance you can afford their home and therefore your offer is given serious attention. This is achieved after the lender has verified all information you have submitted in the application process.
Is There a Cost to Apply?
No, we are very confident you getting a great rate and fantastic service so we don’t need to keep you from going somewhere else.
How Long does the Loan Process Take?
The loan approval and funding time frames vary depending on the type of transaction and the complexity of your personal finances. The process can take as little as 10 days, and sometimes up to 45 days.
What does it mean to lock my rate?
The rate lock will secure the interest rate during the process of your loan. By locking the rate, you don’t have to worry about the rate and payment changing. A .125% increase in rate can be the difference between a person qualifying and not qualifying. We can lock for extended periods of time n the event a new home is being built.
When Can I Lock-in my Rate?
You can lock your interest rate once your offer has been accepted by the seller and the contract signed by all parties. Your loan officer will be able to send you new loan documents based on the fully executed contract and will be able lock based on the closing date in the contract.
How Long is my Rate Lock Valid?
Your rate will be locked with enough time through the designated closing date. In the event there are any unforeseen circumstances, the rate can be extended for little to no fee if the rate market is the same.