Buying a House doesn’t start with open houses and your daily search to Zillow, Redfin, and all other online real estate marketplaces. Home buyers need to start their journey at a Lenders Office.Nowadays most Sellers expect Buyers to have a Pre Approval Letter and will be more willing to negotiate with those who can prove that they can obtain financing. I made a guide on What do you need to get pre-approved.
- Proof of Income
W-2 wage statements; buyers need to produce this document for the past two years. As well as year-to-date income, proof of any additional income such as alimony or bonuses, and the two most recent years’ tax returns. - Proof of Assets
Bank Statements; borrowers must present a copy of 60days worth of assets that you are using to qualify for a mortgage. It must include even the blank pages of the statement. - Retirement and brokerage accounts; Two months of statements from IRAs, investment accounts. The last quarterly statement from 401 showing the vested balance. As with bank statements, include every page, even blank pages.
- Good Credit Score
Lenders require a score of 620 or higher to approve a conventional loan. Lenders typically reserve the lowest interest rates for customers with a credit score of 760 or higher. Those with lower scores must make a larger down payment. Lenders will often work with borrowers with a low or moderately low credit score and suggest ways to improve their score. - Employment Documents Lenders make sure that they lend only to borrowers with stable employment. They will likely call the employer to verify the employment and salary stated on a pay stub presented by Buyers. It also included contact with previous employers if Buyer recently changed jobs. However, self-employed buyers will need to provide additional paperwork declaring their business and income. As well as 2 most recent year’s tax return.
This will ensure the lender that the borrower has sufficient income and have the ability to make the payments on a mortgage. Some more Documents Copy of the following:
Drivers Licence
Social Security Number and Signature;
this will allow the lender to pull up and run a credit report.
Hence, be prepared to provide any additional paperwork as quickly as possible as requested by the lender while you’re at the pre-approval phase.Its highly suggested that you consult with a lender before jumping to the Home buying process. It will help a lot in saving time, effort, and even can save your energies from being disapproved. These will ensure you to gather all what you need to get pre-approved before you go house hunting.
These are the essentials that you need to get pre-approved, completing everything before jumping into house hunting is time and energy-efficient. You can make use of those on choosing your dream forever house for you. Happy House hunting! Feel free to reach out whenever you got pre-approved!
