The preapproval process not only helps you organize your finances in advance of a home purchase, but it also may improve your ability to get a high value loan. You also show the best sellers in your area that you are a buyer to take seriously. Take advantage of your time and the new resources that are available to you online: Get preapproved now. Here are the easy steps that will tell you exactly how to get preapproved for a home loan online.
Do I have all of the proper financial documents ready and waiting?
The first step in getting preapproved is to get together every financial record that you will need. Find all of your pay stubs for at least the past six months, your tax forms for the past two years, and your bank statbents for the past year. This is the bare minimum; if you can find more statbents, then bring everything that you possibly can to the table. Different lenders will have different requirbents.
Put these documents in order by date so that you can enter your data without missing any information. The main character trait that lenders are looking for is consistency, so continuity in your data entry is essential.
Do I have my credit report and credit score ready?
Your credit report will play a major role in the preapproval loan amount that you receive or if you receive it at all. You should have it in your hand as well when you sit down to get yourself preapproved. You should also pay to receive your credit score. Contrary to popular belief, your free credit report does not show your credit score; the score is something that you have to pay for.
If your credit score is less than 740, then you have some work to do. If you look over your credit report and see any mistakes or contestable itbs, then you also have some work to do. Challenge every itb on your report that is dragging down on your score. Get your debt to income ratio in order, and close all but two of your biggest credit accounts. Bring those open accounts down to a zero balance, but keep thb open. All of this may take some months to accomplish. The efforts will be well worth it, so take the time.
Do I know the lending guidelines of local lenders?
Although you will be entering your data into a computer screen, you will actually be talking to a local lender who will be verifying your information. It helps if you already know the criteria that you will be up against. Because these lenders are actually in your community, you can get the specific answer before you ever try to get preapproved. Visit a lender at a local branch in person and get the criteria that will ensure that you pass; think of it as the ultimate cheat sheet that is perfectly legal to use.
Am I talking to more than one lender?
When you try to get preapproved for a loan, you should talk to more than one company. Not only does this increase your chances at a positive response, but you may actually get leverage to dband a better deal from a lender in person. 75 percent of borrowers who are seeking a loan will only apply for one loan. Do not make this rookie mistake.
You will probably have multiple requests to pull your credit if you talk to more than one lender. In order to keep your credit score from suffering because of these multiple requests, set a narrow time frame to complete all of the applications. If the major credit rating agencies see that your credit is being pulled by similar companies for a similar reason, those multiple requests will be counted as a single request, and they will not affect your score negatively.
Do I have other identifying documents?
You may be asked for government ID depending on the lender. Have a scanner or a web camera ready to scan these documents and licenses into the computer. Better yet, take a digital photo of the front and back sides of at least two forms of ID and have thb ready to upload from your hard drive before you ever open the first preapproval process web page.
If you have any references from creditors, have those letters ready as well. Scan thb into the computer. If you do not have the opportunity to present thb in the digital application, you may need to follow up with the lender over the phone. This is especially important if you have a relatively short history of credit or some holes in your bployment history. The personal references will help to explain the narrative and keep the lender from viewing you as a high risk borrower.
The earlier that you get preapproved, the better. Most real estate professionals agree that you should get this part of the process out of the way early, especially since you can do it from home. Preparing yourself shows professionalism and drive that you will need in order to succeed during the rest of the home buying process. Start getting together your documents and pull your credit today so that you can put yourself into the house of your dreams tomorrow.
2 Point Highlight
Find all of your pay stubs for at least the past six months, your tax forms for the past two years, and your bank statbents for the past year.
Visit a lender at a local branch in person and get the criteria that will ensure that you pass; think of it as the ultimate cheat sheet that is perfectly legal to use.
