Getting Pre-Approved for a Home Loan

Getting pre-approved for a home loan can help you understand your potential buying power before you start making offers. A mortgage pre-approval generally involves a lender reviewing your income, assets, debts, and credit to determine whether you may qualify for financing, subject to final underwriting and property approval.

What Is Mortgage Pre-Approval?

A mortgage pre-approval means a lender has reviewed key parts of your financial profile and determined that you may qualify for a certain loan amount, subject to the lender’s underwriting requirements and the property you eventually choose.

A pre-approval is generally based on information such as income, employment, assets, debts, and credit. It is typically not tied to a specific property when first issued.

Pre-approval is not the same as final loan approval. After you go under contract, the lender may still need updated documentation and must review the property, appraisal, title, insurance, and any other conditions required for final underwriting and closing.

Learn more about the mortgage process and available loan options.

What do I need to get pre-approved?

The exact documents can vary by borrower and loan program, but lenders commonly review information related to your income, employment, assets, debts, identity, and credit. These are the most typical items:

• Proof of income: Depending on how you earn income, the lender may review documents such as recent pay stubs, W-2s, tax returns, or other income documentation. Self-employed borrowers may need additional business or income records.
• Employment verification: For salaried or hourly borrowers, the lender may verify current employment and may request documentation showing employment history. Self-employed borrowers may need additional documentation to verify the business and qualifying income.
• Credit: The lender will generally review your credit history and credit scores as part of the pre-approval process. The effect of credit can vary by loan program, underwriting findings, and lender requirements..
• Proof of assets: The lender may review bank, investment, retirement, or other account statements to verify funds available for the down payment, closing costs, and any required reserves.
• Identification and additional documentation: The lender may request a government-issued ID and any other documents needed to verify your financial profile or satisfy the requirements of the loan program.