If you’re contemplating buying a home, one of the primary questions you may be asking yourself, is “How much home can I afford?” While you might have a general idea of how much you can afford per month, it’s hard to know how that actually translates into a home purchase price. Working with a Mortgage Banker to get prequalified can not only help you answer that question, but will also give you the confidence to search for home knowing exactly what your budget it.
The first step in getting prequalified is filling out a loan application. Try not to worry if you don’t know all of the information you’re being asked for (especially your home purchase price, address, etc.). You mortgage banker will mainly be taking a look at the information that you provide about your income, assets, debts, and evaluating your credit history. They’re also going to be working with you to better understand your financial situation, your home buying goals, and will start to identify loan programs that will fit your goals. Remember, your Mortgage Bankers is there to help answer any questions that you might have, and can even help address any financial challenges you have before you’re under contract.
At the end of the prequalification process your lender will let you know the amount you’ve prequalified for and will issue you a prequalification letter. As you begin working with a realtor to make an offer on your dream home, including a prequalification letter will strengthen your offer and validate you as a potential buyer.
Being prequalified is the best way to know how much you can borrow. It gives you the confidence to shop for a home knowing exactly how much you can afford to spend, and present the best offer to snag your dream home. If you have questions about the prequalification process or would like to get started don’t hesitate to reach out. We’re here to help.