Once you’ve engaged a Real Estate Agent to guide you through the monumental task of purchasing a home, the next step is to get pre-approved by a trusted mortgage lender. It is essential for you to have a clear understanding of your financial capabilities when it comes to purchasing a home. At Brenner | Hill, we work with you to obtain pre-approval. Sellers will require a pre-approval letter with your offer.
Knowing how much you can comfortably afford, your monthly payments, the interest rate you qualify for, and your monthly tax obligations is crucial.
Selecting the right mortgage lender is paramount to ensure a smooth transaction. Working with an unreliable lender can turn the process into a nightmare, jeopardizing the timely closing of your purchase. Additionally, choosing the wrong lender could result in regrettable consequences such as paying a higher interest rate or losing out on your dream property due to disorganization during the underwriting process. That’s why it’s imperative to work with the best in the industry.
Paperwork You Need To Gather
Each lender has slightly different requirements regarding what documentation they need from you for the preapproval process, but in general, expect to provide the following items:
- A completed application. The lender will provide this to you directly
- The two most recent months (or a quarterly statement) of any asset information listed on the application. Generally the lender needs checking, savings, 401k, mutual funds, individual stock accounts, IRA’s, brokerage accounts, etc…..
- Past two pay stubs if you are a W2 employee
- Past two year’s worth of W2s
- Past two year’s worth of US Tax Returns
- Past two year’s worth of Corporate Tax Returns (if self-employed and you own over 25% of the company)
Getting a Pre-Approval Letter
Generally, once you submit the above items to your lender you should receive a pre-approval letter within 2–3 business days. In a perfect world, it its best to be completely underwritten — this additional step may take up to 2 weeks. Not all lenders offer pre-underwriting approval. Our preferred lenders offer this additional service.
Get a Loan Estimate and Understand Your Closing Costs
In addition, mortgage lenders are required to provide you with a Loan Estimate (LE) within 3 days of receiving your pre-approval. The LE provides an estimate of the closing costs you’ll need on top of your down payment. These closing costs will include fees for escrow, title insurance, the mortgage lender’s fee, homeowner’s insurance, pre-paid interest, pro-rated property taxes, and possibly other fees. Make sure you understand these fees. Your mortgage lender will provide you with a detailed estimate based on your exact pre-approval price. Remember, these closing costs are due at closing (except for the appraisal and inspection fees which are due on the day those services occur) and are on top of your down payment. Therefore, if you’re buying a $800,000 property and putting 20% down, you’ll need to have funds at closing in the amount of $160,000 plus the closing costs that were outlined in your loan estimate.
Trusted Lenders
For your mortgage needs, we confidently recommend the following brokers. Their expertise and track record in the industry make them an ideal choice for a seamless home buying experience.
Dietrich Miklautsch
Guild Mortgage
Sales Manager, Senior Loan Advisor
(206) 612-4213
dmiklautsch@guildmortgage.net
150 120th Ave NE, Suite 300
Bellevue, WA 98005
Adam Boss
Penrith Home Loans
(206) 353-6329 Mobile
adam.boss@penrithloans.com
301 NE 100th Street, Suite 300
Seattle, WA 98125
