Lupe Soto Realtor & Loan Expert FHA & Conventional loans, First time buyers and savvy investors. Burbank Real Estate & Homes for Sale.  San Fernando Valley Real Estate & Homes for Sale, Antelope Valley Real Estate.

Buyers First Step to Homeownership is to be pre-approved

Buyers first step to homeownership is to be pre-approved

1: You will save much time, effort and heartbreak by knowing exactly how much home or condo you can afford and can concentrate on your price range. If all that the buyer can afford is a $280,000 home, the time that the buyer wastes on looking at homes in $300,000-$350,000 range can be utilized better by looking at properties in his/her price range.

2: In the current realestate market condition, the chances are great that the buyer will end up buying a foreclosure or short sale property in Burbank, San Fernando Valley, Antelope Valley in Los Angeles County, banks or sellers WILL NOT consider an offer on their property unless the buyer attaches a pre-approval from a lender. A pre-approval letter is not a pre-qualification letter. In order to obtain a pre-approval loan letter, your lender of choice will actually review your income documentation, run your credit report, verify funds available for down payment, give you a quote with interest rated and provide you a good faith estimate of the closing costs required to close the transaction. Even then, most bank owned sellers will also require a cross pre-qualification from a mortgage broker of sellers choice.

3: FHA and VA loans are the engine that runs our current banking economy; banks like to make these loans because they are backed by the US government. However offers that are made on behalf of a buyer that finances their purchase through these loans must conform to the specifications that are imposed by FHA and VA lenders. For example; if a veteran wants to buy a condominium, the condo project must be approved by Veteran Administration or FHA. Your Realtor must know if you are using an FHA or VA or conventional loan so the offer would comply with their rules. How can your Realtor know which loan you will get if you haven't been pre-approved?

For your convenience, we will email you the loan application for FHA loans or conventional loans to be completed in the comfort of your home and when ready you can return it to us or to your lender via email, via fax or in person.  We make it easy and convenient to apply for a pre-approval mortgage loan. 

 THE LOAN PROCESS - PRE-APPROVAL

How is pre-approval different from pre-qualification? What are the advantages of each and which option would be the best for you?

Pre-Qualification

This is an assessment by the lender, based on certain basic information given by the borrower (e.g. employment, income, asset information, current monthly debt, and credit worthiness). Based on this quick evaluation the lender makes a tentative decision to pre-qualify the borrower for a certain loan amount. This does not commit the lender at all to the applicant, being only an opinion of the lender.

Pre-Approval  (required per Seller)

Like a pre-qualification, a pre-approval involves a lender making an assessment of a borrower's buying capacity based on her or his income. But unlike a pre-qualification, a pre-approval letter also checks the applicant's credit and is a surer verification of a borrower's income. It takes longer to process and will require more comprehensive documentation, but gives a clearer and more definitive guarantee of the loan amount a borrower is entitled to.  Be prepared to meet with  lender and provide the following:  paystubs for salary borrowers, income tax returns for 2008 & 2007 with W-2's, 1099, copy of your most recent bank statement or 401K where you have funds available for the downpayment.

Why Choose Pre-Approval?

It's advisable to go straight to a pre-approval for several reasons. A pre-approval can strengthen your purchasing power: as a far more accurate evaluation of how much house or real estate you are capable of buying, it will be more appealing and thus perform better than a pre-qualification in a competitive sellers' market. It's also more time-effective since it reduces the time your lender will need to process and fund your loan.

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