How to Get Pre Qualified for Mortgage is a question that comes up often from potential buyers, in addition to when to get pre-qualified and why to get pre-qualified. Mortgage prequalification lets sellers know you are a serious buyer that is ready to purchase when making your offer. Getting a Mortgage Pre Qualification Letter is easier than you might think. Determine the budget for your home purchase, and make sure you meet the debt to income ratios and credit score requirements of the lender and or loan program.
Before you contact the bank to ask how to get pre qualified for mortgage, we suggest firstly, that you begin by looking at your budget. Knowing the amount of funds you have leftover each month after all expenses are paid is critical to determining what you can afford in a monthly mortgage payment. The monthly payment along with mortgage rates will help you to determine what the price range is for the property purchase. Lenders will have a threshold of percentage to evaluate to calculate your debt to income ratio. Your total monthly expenses plus your mortgage payment will need to meet those threshold points. We suggest that you talk to your lenders to get more specifics on this.
After you have reviewed your budget and have your numbers correct, then we suggest that you think about your credit score. Higher credit scores will allow you to get better mortgage rates. Payment history, credit usage, and debt to income ratio all affect your credit score. Consider establishing and maintaining a good payment history for six to twelve months. Using only thirty percent of your available credit lines is good to show low credit usage. For example, if you have a credit line of ten thousand and only use three thousand, this shows a good low credit usage.
Each year, you can check your credit score for free. Additionally, there are numerous credit monitoring services in which consumers can pay for services. Consider knowing your credit score before contacting lenders. We suggest not to contact a bunch of lenders and have them all pull your credit scores as this could have a negative impact on your score! Before focusing on how to get pre qualified for mortgage, we suggest focusing if needed, on improving credit scores to get good mortgage rates.
How to Pre Qualify for Mortgage
After reaching the credit score requirements needed to get the desired mortgage type and or rates and meeting the debt ratios explained to you by lenders, now is the time to consider getting pre-qualified for your mortgage. If you are ready to buy within ninety days, contact your lender to ask how to pre-qualify for a mortgage. Let your real estate agent know your budget so they can send you homes to meet your needs in your price range.
Mortgage Pre-Qualification Letter
Once you have pre-qualified for a mortgage, request the mortgage pre-qualification letter from your lender. When you are ready to make an offer on a home, having the letter will let the seller know that you are a serious buyer.
When working with real estate agents under the buyers’ agency agreement, agents will most likely ask for the Mortage Pre Qualification Letter. Buyers agents work for the interest of the buyers, including looking for properties to meet the clients’ needs, researching the details of properties of interest to the client, and more! Once pre-qualified, contact us if you need a buyer’s agent. We can discuss your new home needs! We will get you set up for an automated home search to have homes that meet your needs sent to you as soon as they hit the market from our South Missouri Properties for Sale Portal. If you are looking to buy, but not yet pre-qualified and need some help in the process, feel free to reach out and we can discuss the next steps.