What is Mortgage Preapproval?

If you’re buying a loft for sale in DTLA, your first step is to get mortgage preapproval – and here’s why.

Mortgage preapproval is essentially a lender telling you, “Ok, as long as your financial situation doesn’t change between now and the time you officially apply for a mortgage loan, we can let you borrow the money you need to buy a home.”

How Do You Get Mortgage Preapproval?

If you’re like most people, you know you should call around to several lenders to find the best rates and terms on a mortgage loan. Once you’ve settled on the right lender for your needs, you’ll provide it with:

Two years of tax returns
Your two (or three) most recent pay stubs
Bank statements for all your accounts
Permission to pull your credit report

The lender will then evaluate your creditworthiness to determine whether you qualify for a loan. If you do, the lender will give you a preapproval letter that’s good for a set period of time (usually 30 days). The letter will note that you’ll still need to officially apply for a mortgage, but that as long as your financial picture doesn’t change significantly, the lender will most likely be able to approve you for the loan when you apply.

Why Do You Need Mortgage Preapproval?

Mortgage preapproval does two very important things. First, it shows you exactly how much house you can afford – that way, you’re not looking in the wrong price range. Then, it shows sellers that you’re a serious buyer; a seller can confidently take his or her home off the market when you make an offer because it looks like you’ll be able to get financing to buy it.

Are You Buying a Loft or Condo in DTLA?

Call us at 213-254-7626 or get in touch with us online to start exploring your options when you want to buy a loft or condo in downtown Los Angeles.

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