Whether you are a first time home buyer, looking to buy a second home or an investment property, the first step in the process is to get pre-approved.
What is a pre-approval?
A pre-approval is a process where a lender reviews your income, employment, credit and assets. After reviewing the credit qualifications, the lender will issue a pre-approval letter mentioning how much home loan you might qualify for.
Why should I get pre-approved?
There are several reasons:
You will know how much loan you qualify for.
You will know how much your estimated payments would be. Sometimes, even if you qualify for more, you would like to keep your payments lower because of other obligations.
Most real estate agents (especially the good ones) will not show your properties till they are sure you are pre-approved for a mortgage.
Sellers won’t consider your offer to buy, till a pre-approval letter is attached to the offer.
If there are any red flags, it gives you time to work on it and correct it before you buy a house.
How long does it take to get a pre-approval?
It typically takes 2-3 business days to complete the pre-approval process at our end. We may be able to rush it if you need to make an offer on a property sooner than that. In some complicated cases, it could take longer than 3 business days.
How long is the pre-approval good for?
A Pre-approval letter is usually good for 60-90 days. However, we at Luchechko Team mortgages understand that it’s not always possible to find a house and get your offer accepted in 3 months. We do not make you go through the entire process again after 90 days. If nothing has changed with your credit qualification, we will simply renew your letter and issue you a new one. Absolutely no hassle at your end.
Will it impact my credit score?
Yes, it can potentially impact your credit score. The amount of impact is dependent on your credit profile, the stronger the credit – the lesser is the impact.
When do I qualify for a mortgage to buy a house after short-sale?
A pre-foreclosure sale or short sale is the sale of a property in lieu of a foreclosure resulting in a payoff of less than the total amount owed, which was pre-approved by the servicer.
Qualifying for Conventional mortgage after Short-sale:
The following waiting period requirements apply for conventional mortgage backed by Fannie Mae
Fannie Mae recently updated its guidelines and established a standard 4 year waiting period for a Pre-foreclosure sale (short sale) or deed-in-lieu of foreclosure, with a 2 year waiting period permitted if a borrower has extenuating circumstances.