Reluctant to go house-hunting? Don’t be. As competitive as the homebuying market is right now, you might be tempted to put your dreams of homeownership on hold. We get it. But if you wait until the perfect time to buy a house, you’ll be waiting forever. Don’t be fooled into thinking this is a bad time to buy just because the market is hot. With interest rates at near record-lows, there’s never been a better time to make a home purchase. And the first big step to becoming a homeowner is getting a mortgage pre-approval. Keep reading to find out how pre-approvals work and why you don’t have to worry about losing your pre-approved status.
The Over/Under on Pre-Approvals
Before we explore how long a mortgage pre-approval lasts, let’s review how a pre-approval works. A buyer who’s been pre-approved for a home receives a letter from a mortgage lender. The letter indicates how large of a loan you can expect to receive. It also reveals the type of loan you will qualify for and your anticipated mortgage interest rate. While a pre-approval is not the same as final approval (this happens during underwriting), it’s the key to being able to make an offer. How so? It shows a seller you’re serious about buying their home and that you’re financially prepared to buy it. All that’s typically required for a pre-approval are bank statements, pay stubs, employment history, credit history, and a summary of your monthly payments. The lender will run a quick check on your credit, too.
So, How Long Does a Pre-Approval Last?
While it’s important to be pre-approved as soon as possible, you don’t have to rush into making an offer. Most pre-approvals are good for at least 30 days and others extend as long as 180 days. Most often, though, a lender will issue a 90-day pre-approval. Regardless, you’ll know exactly how long yours lasts because your pre-approval letter will say so. But whether it’s for 30 days, 180 days or somewhere in between, don’t worry about your pre-approval expiring. And you don’t have to start looking for a home right away.
Even 30 days is plenty of time to find a home and make an offer. It’s a good idea to get pre-approved even when you are just shopping online. This way, you will know exactly how much home you can afford and be ready when you find “the one.” Even if your pre-approval letter expires before you make an offer, you shouldn’t have to start back at square one. Keep your expired letter handy. It’s likely that all you’ll need to do to get pre-approved again is provide your lender some updated financial information.
Ready for your mortgage pre-approval? Our mortgage advisers at Fairway of the Carolinas can get one started for you today. Contact us as soon as you’re ready, and we’ll put you on the path toward homeownership. Here’s a list of Frequently Asked Questions that you might find helpful in the meantime.
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*Pre-approval is based on a preliminary review of credit information provided to Fairway Independent Mortgage Corporation which has not been reviewed by Underwriting. Final loan approval is subject to a fullUnderwriting review of support documentation including, but not limited to, applicants’ creditworthiness, assets, and income information, and a satisfactory appraisal.