For homebuyers1 min read
Preparing for pre-approval
What a loan officer looks at, the documents worth gathering early, and how pre-approval differs from pre-qualification.
What pre-approval means
Pre-qualification is an estimate based on what you tell a loan officer. Pre-approval goes further: the loan officer reviews your documentation (income, assets, and credit) and gives you a number you and your agent can act on.
Sellers and listing agents read the two differently. A pre-approval letter from a lender that has actually reviewed your file carries more weight in an offer.
Documents worth gathering early
Recent pay stubs, W-2s or tax returns for the last two years, recent bank statements, and a photo ID cover most situations. Self-employed buyers should expect to provide business tax returns as well.
You don't need everything before a first conversation. Your loan officer will tell you what applies to your situation.
What affects your number
Income stability, existing monthly debts, credit history, and available funds for the down payment and closing costs all factor in. Loan programs differ in how they weigh each one, which is why the same buyer can qualify differently across programs.
The first step
Talk to a loan officer licensed in your state before you fall in love with a house. It costs nothing, and it turns your search into a range you can trust.
Pre-approval starts with a conversation, not an upload.
Loan officers are licensed by state. Find the one licensed where you're buying and ask what applies to your situation before you gather anything.
Keep reading
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How your credit affects your loan
What lenders look at beyond the score, how credit shapes your options, and the moves to avoid once you're shopping.
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How much down payment you need
The 20% figure is a myth for most buyers. Here's what the low-down-payment programs allow and the trade-offs to weigh.
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Closing costs, explained
What the fees at closing pay for, where your official estimate comes from, and the ways they can be covered.
This guide is general information, not financial advice, a quote, or loan terms. Program availability and qualification vary. ALCOVA Mortgage LLC, NMLS #40508 (www.nmlsconsumeraccess.org). Equal Housing Lender.