Getting prequalified for a mortgage allows you to know exactly how much you can afford, which can save you time and frustration as you’re digging through house listings. No more wondering what’s in your budget! When you narrow down your field, you can get into your new home faster. It also can set you ahead of the game, because sellers will know that you’re a serious buyer and can afford their home. So if you end up bidding against another buyer who isn’t pre-qualified, it could mean the difference for whether or not you get the home.
Prequalification Questions and Steps:
- Credit score? The most important thing you can do is improve and protect your credit score. Make sure you pay your bills on time. You should only use about 30% of your available credit. And remember – no credit is bad credit. Lenders will want to see that you’ve been making consistent payments.
- Can you help? We’re here to guide you in the process. We’re more than happy to go over whatever challenges you find with you, and we’ll help in any way that we can. We’re happy to put together a plan of action to better your situation.
- What should I aim for? Aim for your debt to income ratio being 50% or less! Debt to income ratio is simply all of your revolving debts combined, which includes your new mortgage, taxes and insurance. That total should be less than 50% of your gross income.
- How do I get prequalified? Give us a call or start online! When we offer a Pre-Approval, we will provide you with an official Pre-Qualification letter based on the factors in which a mortgage would be based. If you contact another lender, be sure that they are giving you a quality quote based on credit score, income, etc and not just an estimate…that could mean big trouble for you when you find your dream home.
- Can I switch lenders after prequalification? Yes! Don’t sweat it. If you’re not sure what lender you want to go with yet, you can always switch. Getting a prequalification doesn’t lock you into using that lender.
Overall, prequalification puts you ahead of the game and there are no real strings attached. It’s just an assessment of where you’re at and an official statement of what kind of mortgage you can get, which is helpful no matter what stage you’re in during your home search. If you have any questions or want to get a prequalification, give us a call! We’d love to help you.
All the best,
The Christian Mortgage Mom