Mortgage Pre-Approval Process For Homebuyers

Mortgage Pre-Approval Process For Homebuyers

If there is one thing you can do as a prospective borrower in today’s mortgage landscape, it is to know the Mortgage Pre-Approval Process.  When you are tasked with purchasing a home, you need to know the steps along the process from applying for a mortgage all the way until closing.

The Importance of Understanding The Mortgage Pre-Approval Process

The Importance of Understanding The Mortgage Pre-Approval Process
There is nothing worse than going through this process in the dark and working with lenders who are not up-front with delivering information and the status of your loan to you.  At every step of the way, there is no reason why you should be guessing as to what is going to happen next, what documents are to be provided, and when you should hear correspondence next.

Why A Mortgage Loan Should Not Go Beyond 30 Days to Close

At Loan Consultants we like to work with lenders that have the same ideals that we have. We want to make sure we are always on the same page from the first loan we do, until the last.  We always have the borrower’s best interest in mind and that is why we only want to work with lenders who can close loans in an efficient and timely manner.

Over 75% of Our Borrowers Are Folks Who Could Not Qualify at Other Lenders

There is no reason to wait 2+ months for a loan to close or to be left with denial after the 2 months.  This isn’t just bad for all parties involved. We know this will leave a bad taste in the mouth of the borrower especially.  Hopefully, after going through the following Mortgage Pre-Approval Process you will be confident in the process and working with Loan Consultants for all your financing needs!

What To Expect During The Mortgage Pre-Approval Process

What To Expect During The Mortgage Pre-Approval Process
As you might expect, the Mortgage Pre-Approval Process is vital in making sure you can get to the closing table.  Granted this is only a part of the entire transaction, but without a solid Pre-Approval Letter, you run the risk of being left out in the cold with a denial down the road.  If you are working with a lender who says they can give you a solid pre-approval over the phone, they are doing you a disservice.  You need to evaluate if this is the right lender for you because they have not done their due diligence to ensure your loan will close.

The Importance of a Solid Pre-Approval To Close a Mortgage Loan on Time

Without taking a deep dive into your credit history and financials, there is no way a conversation should result in a pre-approval.  Here at Loan Consultants, we are going to request you deliver documents to us after our initial discussion in order for us to obtain a 100% understanding of your history and situation.  After you fill out the application and your credit has been run, this is not the end of the pre-approval process here.

Complete and Legible Mortgage Documents

We are still going to need documents from you to support our findings from your credit report and application.  After we have gone through all of our checks will we issue a pre-approval to you?  Once we issue a pre-approval to you, we are 99% confident that we will get your loan done.  Notice I didn’t guarantee 100% as there is always a chance your loan could get denied. In doing all the research into your background, this should never happen to you.

Steps of the Mortgage Loan Approval Process

Steps of the Mortgage Loan Approval Process
After your application has been filled out and credit has been run, we will follow the Mortgage Pre-Approval Process below:

  • After your application has been verified and your credit report run, there will be requests for other documents.
  • Examples of required documents by lenders include bank statements, W2s, tax returns, bankruptcy documents, etc.
  • The reason for the necessary documents required is due to an effort to fill out a complete profile in order to run AUS or the Automated Underwriting System to obtain an Approve/Eligible for a mortgage.
  • After the hopeful issuance of an Approve/Eligible, there is more scrutiny placed on the file used to run AUS to ensure that there are no errors with the information provided.
  • You can still have a denial if items were input correctly.
  • You should be going over your credit report with a fine-tooth comb with the help of your loan officer so that everyone is confident that the information on there is 100% accurate.
  • The smallest mistake can cost you approval down the road and nobody wants this to happen.
  • Once the credit report has been checked for errors, the loan officer should go through the income documents from the prior 2 years.
  • In addition, income documents such as tax returns as income is one of the most important items needed to determine qualified income.
  • For example, if a borrower or co-borrower is dependent on overtime as an hourly employee, a verification of employment should be obtained.
  • This is to make sure the income has been earned consistently for the past 2 years or the risk is this income can be disallowed by underwriters.

As you can see, it is always vital to go through all documents and information with a high level of scrutiny as this will only benefit the borrower in the end and prevent them future headaches.

Mortgage Pre-Approval Process: Credit Report Scrutiny

In order for the Mortgage Pre-Approval Process to be successful, a borrower needs to be up-front and honest with you. It doesn’t do them any good if they should try and hide information from you, and borrowers should be made aware of this.  For example, if the borrower has had any public records filed against them and they go to a credit repair company that has successfully gotten them removed, these items will still be found.  If you use a public records company to do your research, this will return all records including bankruptcies, tax liens, judgments, etc.  If it is found after the fact then the mortgage application will almost certainly be denied as a result of this.  Borrowers need to understand that trying to proactively leave items out, ends up hurting them in the end.

Mortgage Pre-Approval Process: Loan Consultants

If there is one thing that is a certainty when dealing with us it is that we will be here for you if you should get a last-minute denial or are flat out denied by another lending institution.  More than 50% of our business is from cases like we have outlined where a borrower gets a last-minute denial due to the fact that the loan officer didn’t do their job properly.  Be aware that we take care of all our borrowers and we will be here to ensure that you do not get a denial if you did, we will be 100% transparent and up-front with you because there is no sense in wasting your time or ours.  If you want to get the process started today, please feel free to reach out anytime at Loan Consultants Mortgage at 844-275-2007. Text us for a faster response.  We look forward to hearing from you today!

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