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Servicing: Kansas City, Smithville, Liberty, Kearney, Platte City, Gladstone, North KC, Excelsior Springs, Zona Rosa, Platte Woods, Weston, Riverside, Trimble

How to get pre-qualified for a Home Loan

Getting a pre-qualified loan is a good idea when you’re thinking about buying a home. It can help you save a considerable amount of time and stress wondering if you qualify for a loan or whether your loan terms matches the purchase terms.

Getting a pre-qualified loan shows you and the bank know how much you can afford to borrow, and for you to find out what kind of house you might be able to purchase. It just means that you have assessed your income, plus assets and showed them to the potential lender.

This process also gives you an opportunity to talk about what your goals and potential needs are with your potential lender. You can discuss various options, whether it is over the phone, internet or in person.

If you want to buy a home, here is how you can prequalify for a home loan:

Step 1 - Check Your Credit Report & Score

In order to purchase any type of property that would require a mortgage loan you must first be able to pre-qualify for a home loan. The first step to getting a mortgage loan is to check your credit. You are allowed 1 free credit report a year for the big three. You can use an online service such as Annualcreditreport.com to get these. You can also contact each of the three credit bureau's and have them mail you copies.

Order your Credit Report

  • Equifax 1-800-685-1111 - you can get a free report if you have been denied credit in the last 60 days.
  • TransUnion 1-800-888-4213 - receive within 6 to 8 business days.
  • Experian 1-888-397-3742 - receive within 8 to 10 business days.

Address for the Credit Bureaus

Experian
P.O. Box 9701
Allen, TX 75013

Equifax Credit Information Services, Inc.
P.O. Box 740256
Atlanta, GA 30374

TransUnion, LLC
P.O. Box 2000
Chester, PA 19022

When ordering your credit reports, make sure you have the following information before making your request.

Keep in mind. You must have at least a 600 credit report score to purchase a new home, have no levy's, back child support, back taxes, back student loans owed or leans against you. If you have any of these items we can still work with you to help resolve these issues.

Step 2 - Figuring out how much home you can afford

Over to the right is a mortgage calculator. You can use this mortgage calculator to estimate out how much of a payment you might expect. For those who have a somewhat good credit score you can expect a 4-6% interest rate. Click here to view current mortgage rates for Kansas City area. For the annual property taxes, hazard insurance and the private monthly mortgage insurance you can make an educated guess.

Once you have an idea of what your monthly mortgage payment might be, do not forget to add in closing costs, down payments, appraisal, inspection and possible attorney fees. If you are not sure what these might be, we would be more than happy to assist you with this as well to help you get a ball park figure of what these fee totals might be.

Step 3 - Home Pre-Approval

This next step is one of your most important steps you will take. I have worked with some of the best lenders here in Kansas City and it has been my privilege to do so. I would be more than happy to put you in touch with a lender that passionately cares about helping you get into your dream home. These lenders literally work day and night to help you prep for your home loan walking with you hand and hand to signing. The first thing they help you with is qualifying for a home loan and they are good at it. Getting pre-qualified for a home loan helps you in several ways.

  • Let's you know what you can afford
  • Determines what your approximate costs will be
  • Instructs you on what to expect during the buying process
  • Removes the disappointment of finding a home just to find out do not qualify for it.
  • Makes you more appealing to buyers
  • Quickens the process once your home is found
  • and much more...

With every lender you talk to, you will need to fill out an application form. Depending on the institution, you might be able to fill out a form online and get instantly approved. If this is your first time buying a home, you might want to think about speaking to someone face to face. This is something I can help you with.

Be careful NOT to apply to too many lenders at once. If you apply for several loans together, it WILL lower your credit score and could possibly affect your interest rates or qualification for that matter.

Get Together Proof of Financial Standing

Before filling out any forms, make sure you figure out how much you might want to borrow, plus how much of a down payment you can afford. After that, it’s time to gather up some paperwork. Here is what you should bring along with you to the lender, or have beside you when filling out a form online:

  • Proof of income over the past two years or more. If you have proof of steady employment, even better. Paychecks will suffice.
  • Your credit report. It should be in good standing. If your credit is less than stellar, talk to the lender to see what their requirements are.
  • Any previous mortgage information if applicable
  • Your social security number and pieces of identification

Since getting a pre-qualifying loan is a relatively quick process, it doesn’t mean that if you get pre-qualified for a loan it’s guaranteed to you. It’s basically an approximate amount that might be loaned to you.

If you would like to ask any questions or need any help, please do not hesitate to contact me.