1. Getting Pre-Approved for Your Next Home

    It is a lot of fun to daydream about purchasing a new home. Are you one of the people who can spend hours on Pinterest daydreaming about the features, details, and quirks of what your dream home would look like? You aren’t alone.

    Purchasing a home is an exciting adventure, and most likely the largest purchase you will ever make.  There are many thing to consider when purchasing a home, starting with making the decision to become pre-approved.

    What does this mean? A pre-approval is a commitment in writing from a lender that a borrower would qualify for a particular loan amount based on credit information and income. Typically, these letters are good for 60-90 days.

    Why should you consider being pre-approved? Where to begin because there are many reasons to consider this! Most importantly, being pre approved gives you an idea of how much you can afford. Once you have this budget, you will have a better picture of the price range you should be looking in. Another reason is to ‘cut the line’ if you will in competitive markets. If you find a home you love and want to make an offer on, having a pre-approved letter will help you be taken more seriously. Not to mention, bank-owned homes usually require the letter before they will even accept an offer.

    How do I get pre-approved? If you’re sold on the idea of being pre-approved,  you will need to know the next steps. Your first step will be to contact a lender and wait until you are approved and they send all necessary paperwork.

    • Your W2 from the past two years
    • Your paystubs for the past three months
    • Your tax returns from the past two years
    • Your checking or savings bank statements for the past three months (this will likely have your down payment funds in them as well)
    • Your statements for all your other assets (stocks, bonds, retirement accounts) for the last two months
    • The name and phone number of your landlord (if you are renting) or your current mortgage documents
    • Your divorcee decree, if applicable
    • If you are self-employed: Your business tax returns for the past two years in addition to your year-to-date profit and loss statement and year-to-date balance sheet

    If you are not able to get pre approved, do not fear. Ask your lender for tips on what will raise your credit score and improve your chances on qualifying for a loan.

    Check out this video for more tips and advice on the process.


    As you begin your search for the perfect home, we invite you to visit a Neal Community. We have a feeling you will love what you see.