Monthly Archives: July 2018

Financing Your New Home

You’ve made the decision to purchase a new home, but how will you finance it? We’ve got lending options for all types of buyers. Let Bill tell you how we can help.

With our extensive network of lenders in East Liverpool, East Palestine, and greater Columbiana County we can help you find the right option for you.

Understanding the Mortgage Pre-Approval Process

Understanding the mortgage pre-approval process

mortgage pre-approval

Pre-Qualification is NOT Pre-Approval
To get an idea of how much a bank will loan you for the purchase of your new home – it is smart to approach a bank or credit union for pre-qualification.  This process is usually done over the phone and does not involve a credit check. The loan officer will ask about your income and assets, determine how much of a down payment you can afford, and calculate what kind of loan you’d likely qualify for.  This does not guarantee you will qualify for a loan at that amount but gives you a fair starting point.

Pre-Approval
This step is much more involved and will require an appointment with a loan officer at a bank or credit union.  In this step the loan officer will get all of your income information (i.e W-2s, tax returns, bank statements, etc.) and will check your credit history.  Based on a calculation of this data, you will be approved for a “good faith estimate”. This estimate does not guarantee you will have final approval for the loan;  it spells out the likely terms of the loan, including the interest rate, loan type and closing costs.  With pre-approval you are approved to get your loan, unless there is a problem with the underwriting.

Shop Around
It is important to meet with multiple banks about the pre-approval process. A good realtor will be able to help you select reputable lenders with good track records. Although the process is basically the same with each lender, interest rates can vary and other costs like private mortgage insurance and closing costs can be different.  Meet with at least three different banks and compare the results of those meetings before selecting the right mortgage company for you.

Make offers with confidence
Once you have your pre-approval letter – you can make offers with confidence and negotiate on price within your budget.  Some sellers prefer to restrict showings of their homes to those with a pre- approval letter from a bank. Knowing what your budget also allows you to use your time wisely, only shopping for homes within your means. not waste time looking at homes you means, making the process a lot easier.