What to Do Before Getting Prequalified for a Mortgage

Applying for a home mortgage is often intimidating, and this is especially true if you are a first-type homebuyer. By preparing for the process and knowing what to expect, you can reduce some of the stress that you may otherwise feel. How can you get ready to apply for your new home mortgage?

Research Loan Types
A good mortgage broker or lender’s rep will take time to answer all of your questions about loan types and programs, but you should educate yourself about the basics before talking to different loan professionals. A good starting point is to research the differences between FHA, VA and conventional loans. Learn about differences between fixed rates and adjustable rates. With this basic knowledge, you can discuss the options more confidently with your lending professional.

Know Your Timetable
A loan prequalification is only valid for a relatively short period of time. Getting prequalified too early may result in the need to resubmit paperwork and to go through the process a second time. Unless you are uncertain about your ability to qualify, it often makes sense to wait until you are ready to actively start searching for a home.

Watch the Rates
Interest rates change frequently, and some movement can be rather significant. Keep in mind that the difference of even a quarter of a percentage point can equate to thousands of dollars or more over the life of a loan. With this in mind, it can pay off to watch the rates and to lock in your rate when you notice a downward trend.

A mortgage broker will actively shop around to find the best program for your needs. A lender, on the other hand, can only offer you the programs available through its institution. With this in mind, it makes sense to find a trustworthy and experienced mortgage broker to guide you through the process.

Contact one of our loan consultants to get more information.