Via Oregon - May/June 2021 - 16

MONEY

How to get
preapproved
for a mortgage
These simple steps walk you
through the process.
Ready to buy your first home? You will likely
need to get prequalified or preapproved for a
loan before you can start putting in offers.
To get prequalified, you give a lender basic
information about your income, debt, and
assets available for a down payment, and the
lender gives you a letter with a ballpark estimate of how much you can borrow, usually
within minutes.
In hot real estate markets where you are
competing with multiple bidders, however, you
will need to get preapproved. When you apply,
a loan officer will review your credit reports, W-2
forms, tax returns, pay stubs, bank statements,
and other documents to assess your financial

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standing. The officer will then
issue what most lenders call a
preapproval letter, stating how
much you may be able to borrow, subject to various conditions. You may need this letter
in order to be taken seriously
by sellers and their agents.
Seasoned real estate agents
might not even show you
homes until you've taken this
step, says Duncan Robertson,
a loan officer with Fairway
Independent Mortgage
Corporation in Phoenix.
Getting preapproved will
also let you know if you're
eligible for any programs
offering down payment or

closing cost assistance, says
Ann Thompson, Bank of
America's consumer lending
executive for the West.
When to get preapproved
depends on your situation:
Wait too long and you could
miss out on your dream house,
but if you start too early, you'll
need to repeat the process,
and this could cause a small
dip in your credit score from
the inquiry. Dick Lepre, a
senior loan advisor in Alamo,
Calif., with LendUS/RPM
Mortgage, advises buyers to
get preapproved a month
before they're ready to make
offers. Robertson recommends starting as soon as possible-even a year out-to
uncover issues that may take
time to resolve and to give you
enough time to improve your
credit score so you can qualify
for a better rate or larger loan.
In order to get preapproved
for a mortgage, you'll need to
tackle a few items first. Begin
by gathering all the documents needed for preapproval: a copy of your driver's
license, income documentation, the two most recent bank
statements for every account
you will be using to qualify,
and proof of gift funds (if
you've been gifted money).
Next, ask your real estate
agent to recommend lenders
in your area. Local lenders
might have less red tape and
provide more support
throughout the process than
the megabanks, says realtor
Linnette Edwards, owner of
Abio Properties in Oakland,
Calif. " You have a greater
chance of your offer being
accepted with a local lender

TOP: ANDY DEAN PHOTOGRAPHY / SHUTTERSTOCK; BOTTOM: SONG_ABOUT_SUMMER / SHUTTERSTOCK

SMART LIFE
Via Oregon - May/June 2021

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