You only need two very special virtues to obtain a home mortgage pre-approval: Patience and Organization! Naturally, there are a few other details. Let’s look five top questions about the process of loan approval

First: What are the benefits of being pre-approved?

There are several reasons to be pre-approved for a mortgage by a mortgage banker or a broker:

…As a buyer, you can use your pre-approval as a negotiating tool. You see, a seller might accept a lower offer if you are supported by a pre-approval. This could make a big difference if another buyer offers a competing price. A bonus of the process is that you can also get a practical picture of how much you can afford early in your house shopping.

Second: Where do we start?

The initial step in the process is simply to submit an application to a lender or a mortgage broker. “The buyer should have an idea of the size of the loan being contemplated, and the lender or the broker will work with the applicant to determine just how much home he can afford.” Prospective buyers should always try to avoid the temptation to stretch a contemplated payment too far, thereby taking on more loan than can easily be afforded.

Third: What are the details of The application process?

You will need proof of your income, a good work history and a strong credit history. These three things are checked so avoid exageration. It might seem picky, but the world of mortgages is a world of precise numbers. Therefore, be ready to give the lender a host of paperwork: bank account numbers, income tax returns, pay stubs, and other financial documentation. Your best time-saver in this situation is to have all these papers lined up so that you can reduce the time needed for obtaining pre-approval.

Fourth: How long does this take?

There is no standard or set time for any lender to accomplish the procedure from submission of your pre-approval application to a decision. In 2013 in could be a day, a week, or more. (We know that there used to be instant pre-approvals, but this is no longer true.)

Fifth: Will a pre-approval guarantee my funding?

The pre-approval is not a 100 percent guarantee. Most lenders will examine your finances in more detail after you choose the home you want to buy. Just expect the most meticulous financial inspection you can imagine.

Another warning from the experts cautions you to avoid other major shopping sprees after you have your pre-approval. You do not want to blow your house deal by affecting your debt-to-income ratio. Remember, if the debt-to income ratio changes too much, the lender could reduce or even withdraw your mortgage pre-approval. If you are looking for more information, we recommend one of our previous blogs, which will give you a real perspective on both sides of the pre-approval process, yours and the lenders.