What Is Pre-Qualifying to Get a Mortgage?

What Is Pre-Qualifying to Get a Mortgage?

People usually pre-qualify to get a mortgage well until they apply for one, and also before they've found a home to buy. Pre-qualifying means the lender reviews your financing and quotes how big a loan you would qualify for, but it doesn't guarantee you'll get. Nevertheless, knowing how expensive a home you can manage will save yourself time when you go house-hunting.

Starting Point

To be able to pre-qualify you, many lenders will want to see certain financial information, the Realty Times site states: at least two years of steady employment, with constant or increasing income; a fantastic credit report; no bankruptcy within the past two years; without inflation within the past 3 years. Anything less and they may not think you qualified.

Income/Debt Ratio

Lenders may also want to check at your income and your debts. Unless the payments equal 30 percent of your earnings or less you won’t pre-qualify to get a mortgage. Your overall monthly debts–child support charge card payments, student loans and payments –and your mortgage payments ought to be, at most, 40 percent of your earnings, according to Realty Times.


Lenders aren’t legally obligated by their own pre-qualification amounts –they don’t have to loan you that big a mortgage or some other mortgage at all–they may be willing to pre-qualify you based solely on a phone conversation and a fast credit check, Realty Times states. If you go in the mortgage process, the lender will want you to document your financial claims all and will check them out thoroughly.

Pre-Qualifying Letter

Once you’re pre-qualified, you will be provided by your lender with a letter stating the size of the mortgage. Even though this isn’t a warranty, it may provide you a bit of credibility when you begin house-hunting, as evidence that in the event that you make a deal on a home, you have the financial tools to close the purchase.


Individuals frequently use”pre-approval” and”pre-qualification” as if they mean the same thing, according to the San Diego Union Tribune, but they don’t. Pre-approval means your financial information has undergone scrutiny and also the lender has run the mortgage that is potential by an underwriting agency to acquire a mortgage estimate. Isn’t a dedication, but it is nearer than pre-qualifying and will carry more weight when you’re negotiating to buy.

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