Getting pre-approved for a mortgage is one of the first steps in your home buying journey. Here's what actually happens.
What Lenders Look At
• Credit Score: Most conventional loans need 620+, but 740+ gets the best rates
• Debt-to-Income Ratio: Your monthly debt payments divided by gross income, ideally under 43%
• Down Payment: How much cash you can bring to close
• Employment History: Typically 2+ years of stable income
• Assets: Bank statements showing reserves
Pre-Qualification vs Pre-Approval
Pre-qualification is a quick estimate based on self-reported info. It's not verified.
Pre-approval means the lender has actually checked your credit, income, and assets. This is what sellers want to see.
The Process
1. Gather documents (W-2s, tax returns, bank statements, pay stubs)
2. Apply with a lender
3. They pull your credit and verify everything
4. You get a pre-approval letter valid for 60-90 days
Tips
• Don't make major purchases or open new credit before closing
• Rate shop within a 14-day window to minimize credit impacts
• Ask about different loan programs (FHA, conventional, jumbo)