Finance Articles

Pre-approved Mortgage Loan - How Important Is A Home Loan Pre-approval?

How important is a home mortgage loan pre-approval? The short is ?very important? but read further before getting your hopes too high only to be disappointed later. Learn what being pre-qualified and being pre-approved for house loan mean to you.

It helps to be ready if you?re in a competitive market. If you are lucky enough to be pre-approved for a home loan, it can give you an edge over other buyers who may be interested in the same home or condo who perhaps aren?t financially stable. If you do therefore take the large step of being pre-approved for a mortgage loan, it?s an indication to the home owner that you are serious about buying his / her home and not just bargaining to find a steal!

What you need to do to get a pre-approval for a Mortgage Loan?

First step is an honest evaluation of your financial situation. Add up a list of all your assets comprising your cash, stocks, mutual funds, bonds, savings, IRAs, and any other investment and then deduct all the loans and payments that you have to make. This amount will indicate what kind of house you can afford.

Remember ? there are additional expenses while buying a house. This will give you a realistic picture of just how much you can comfortably borrow and how much you will qualify to borrow. It is possible to borrow an amount that will cover the all the insurance and taxes of the first year.

Once you know how much mortgage loan you can afford, you can approach a lender or apply for a home loan online. Many online mortgage loan sites offer quotes from at least 5 lenders. Online mortgage loans are popular because the lender contacts you based on the information given by you. That makes it easier for you narrow down the lenders who are interested in working with you. Also, online application is good for busy people.

What is Difference Between being Pre-qualified and Being Pre-approved for Loan?

Pre-qualified means you contact a mortgage lender and give him/ her, your details in person or on the phone and then he/ she creates a file credit report based on details given by him. This information is usually not verified. You will get a letter stating that you are pre-qualified.

Pre-approved means a commitment from a mortgage lender once you have filled out an application for a home mortgage loan and your details have been verified. These details will include credit report from the three largest credit reporting agencies ? Equifax, Experian and Trans Union Corp. Most online applications go through this pre-approval process.

If your credit score is low that does not necessarily mean you will not be pre-approved for a home loan. Some lenders ask for additional details like your salary statement, bank statements, W2 etc. Also, a willing lender will ask questions about the reasons why the credit score is low and why there collection records in your credit report. If the credit score is low but if you still confident that you can buy a house, then you can answer these questions.

This may be a little too much questioning but at least the lender is willing to work with you even though your credit score is low instead of just rejecting your home mortgage loan pre-approval application! Most lenders have knowledge of how to improve your credit score and may give you some tips to increase your score.

To be pre-approved gives you an edge when shopping for a home. You learn to identify the price range in which you?re looking to buy a home. This makes it easier for a home seller to accept or reject your offer if you?re bidding over a non pre-approved buyer. You must also familiarize yourself with a comfortable monthly loan installment.

Being pre-approved puts you in a better position as serious buyer and your negotiations maybe considered more seriously than other potential buyer who is not pre-approved for a home mortgage. Usually the pre-approval letter has an expiry date. A lot of times the expiry date for the pre-approval letter could be 3 months.

In conclusion, it is best to be pre-approved rather than pre-qualified for a mortgage loan. Be realistic about the amount of home loan you can afford. It is better to live a little below your means than to borrow more than you can afford. There are additional expenses involved while buying a home so you need to factor that into your house loan. So, be prepared when you apply for home mortgage loan pre-approval.

Lokesh Kumar is a small business owner and investor. His is a real estate investor with good knowledge about finance and home mortgages. To discover more about home loan mortgages, refinance, home equity, mortgage rates, mortgage calculator etc, visit: http://www.home-loan-mortgage-net.com/

Other Article Sites

findabook.com  moneycd.info  a-mortgage.info   about-lemon-laws.info  aboutstudentloans.info
all-about-publishing.info  auctions-articles.info  bestcollege-university.com  bestispconnection.com
biblefolder.com  blogger-website.com  books-used.info  brokers-guide.info  buywindows.info  cable-dsl.info
career-miner.com  carpel-tunnel.info  cashinaflash.info  cashloanreviews.info  casinobell.com  chat-house.info
clearmycredit.info  collegeloantips.info  crones.info  depression-articles.info   dirnic.net  dishguides.info
divers-below.com  expodog.info   financewizz.com  fire-insurance.info  getgood.info  handleit.net   it-idea.info
health-supplies.info  hosting-right.com  insidealert.com  insurance-facts.info  jobs-employment.info
justgood.info  lookgold.net   lowcost-travel.info  money-source.info  myhostzone.info  numisblog.com
peoplesearchfinder.info  pr-articles.info  realeas.com   refinancing-guides.info  spyware-remove.info
telelot.info  the-law.info   toppaid.info  travel-deals.info  travelcorrect.com  wedding-guide-site.com
your-blog.info  your-credit.info

Should You Pay Off Your Mortgage?
If you have a mortgage on your home, then paying it off early could be option for you to consider especially if the remaining debt is manageable. Conventional financial wisdom could suggest otherwise, but then there is nothing conventional about most debt anyway. Should you pay off your mortgage? Well, that ultimately becomes a personal decision one that you need to explore and decide for yourself.

Access Business Technologies Unveils PowerSite – Instant Websites for Mortgage Companies
ABT Continues Providing Innovative Solutions to it’s Customers.

Cover Your Home With Mortgage Payment Protection Insurance
It does not matter how long you are into paying your mortgage, if you cannot keep it up then you are at risk of losing your home You could have paid faultlessly for 10 years and then have to take time off from work after becoming ill or suffering from an accident

Inform Technologies Receives $15 Million Investment from Spark Capital: Inform, New Technology Solution for Established Media Brands, Will
Inform Technologies, a technology solution for established media brands, has received a $15 million investment from Spark Capital, a Boston-based venture fund focused on the intersection of the media, entertainment and technology industries. Inform will use the funds to help implement its strategy for accelerated growth.

Auto Finance News and Motor Finance Magazine Create Transatlantic Partnership Agreement
Content sharing agreement links the world's top publications on automotive lending and leasing.

Plantation Shutters are a Good Long Term Investment For Your Home Sublime
Considering new window treatments for your home? Look into plantation shutters, not only are they attractive but offer good long term value for your home.

Leading Mortgage Broker Angelo Christian Reports Growing Trend in Houston Home Refinancing to Offset Rising Cost of Consumer Goods
Houston homeowners turn to the home loan insider to make ends meet.

Real Estate Investment Firm Announces Release of Free Real Estate Investing Newsletter
Real Estate Investment Firm, RealNet USA, proudly announces the release of the first edition of their Real Estate Investing Newsletter, "Real Estate Insider's Chronicle," designed for investors. The chronicle is intended to keep investors informed and up-to-date in the latest market trends, available Real Estate Investments on the market, and existing Real Estate Investing Options.

Bad Credit Mortgages And Getting The Finance You Need
Bad credit can be financially crippling when trying to apply for a credit card or a loan or even more of a problem when applying for a mortgage. Bad credit can cause many sleepless nights and family stress, while trying to acquire a mortgage for your new home.

Maximizing a Stock Market Investment
Maximizing a stock market investmentThere are several factors an investor in the stock market should consider for a maximum return on an investment:1. All stock purchases should be commission-free.

Mortgage After Bankruptcy - Post Bankruptcy Financing - Frequently Asked Questions
If you have recently filed bankruptcy, you may have a few questions about your ability to get a home loan. Here are some common questions about mortgages after bankruptcy:

Springboard Assists Federal Reserve Bank with Community Response to Rising Mortgage Woes
Springboard President and Chief Executive Officer Todd Emerson panelist in discussions with counselors, lenders, and community leaders to asses community impact of mortgage default and foreclosure

Martin Weiss Examines the Mortgage Meltdown in Latest Issue of Money and Markets
Martin Weiss, Ph.D. examines the mortgage meltdown in the U.S. In this issue of Money and Markets, Dr. Weiss takes a closer look at mortgages and recommends what to do with the assets being affected.

How To Get The Best Holiday Let Mortgage Offers
When it comes to getting the best holiday let mortgages offers there really is only one way to go and that is with a specialist broker. A specialist broker knows the ins and outs of the business and what is needed, so can save you a great deal of time and in the long run, money.