Loan Pre-approval

GET PRE-APPROVED FOR A HOME MORTGAGE LOAN

One of the most important steps prior to beginning your LA home search is getting pre-approved for a mortgage loan. This step will help you determine how much of a home you can afford and assist you in shopping within your price range. The loan pre-approval gives you an advantage over other buyers who are not pre-approved. It’s a sign to home sellers that you are a serious and prepared home buyer. Jack is happy to refer you to a lender who will be able to help you with the pre-approval process.

THE PRE-APPROVAL PROCESS

To get pre-approved for a home loan, you need to contact a lender. If you do not have a lender, Jack can refer you to some reputable local mortgage brokers. Once you have chosen a mortgage broker to work with, we recommend scheduling a call or a meeting with the lender. This is best way to get all of your home loan questions answered and start the home loan pre-approval process. Finally, before you start the loan pre-approval process, we suggest to not make sudden job changes or other large purchases. You want to approach your home purchase from a position of financial stability and security.

The loan amount that you are pre-approved to borrow is typically based on the 4Cs:

- Capacity: Your current and future ability to make your home loan payments.
- Capital: Your money, savings, and investments that can be sold for cash.
- Collateral: The home that you would like to purchase.
- Credit: Your history of paying bills and debts on time.

THE PRE-APPROVAL LETTER

Once you are pre-approved, your lender will issue you a pre-approval letter. Your pre-approval letter is a document from your mortgage broker or lender stating how much of a loan they are willing to give you. You will need this document when you go to make an offer on a property. Your pre-approval letter can also put you in a stronger negotiating position, as it shows the seller that you are a committed buyer, financial capable of purchasing the property and more likely to close escrow. Please keep this readily available during your home search process.