ADVANTAGE OF PRE-APPROVAL PROGRAMS

• Borrower knows upfront if they qualify for the new home. Limits any surprises in the loan approval process.
• Seller wants to know that the buyer is pre-approved before accepting a contract on a home.
• Can benefit the buyer if the seller is choosing between multiple contracts. Seller may choose buyer’s contract over another if they are fully approved and can close sooner.
• May allow the buyer to get a better interest rate.
  

BUYER QUALIFICATION GUIDELINES

There are four main areas that a lender reviews when qualifying a borrower.

• Credit – Lender is looking for short and long-term repayment history to ensure that the loan will be paid back in a timely manner.
• Assets – Lender wants the borrower to have adequate reserves in the bank so that if the borrower is out of work or unable to be paid for any reason that they can still make their payments through savings.
• Income – Lender wants to verify that the borrower has the means (income) to repay the mortgage in a timely manner. Lender will also look at the borrower’s work history.
• Down Payment – Lender wants to make sure that the borrower has adequate funds to put down on the home.
  

Click here to view our Loan Application Checklist