As you begin to search for homes for sale in Nashville, you’ve probably enjoyed scrolling through listings and scheduling in-person tours to find your dream home. Getting pre-approved for a mortgage loan may not be as exciting as home tours, but it’s a crucial part of the process. Getting pre-approved by a lending company shows sellers that you’re serious about this purchase and have the money needed to take on such a large investment. It’s also a required step unless you’re making a cash offer on a home. Review our top tips to help you get pre-approved for a loan.
Collect All Required Documents and Information
A lender will want to make sure you have adequate funds for a down payment and mortgage. You’ll need a substantial number of documents to support that you’re in good financial standing to be able to qualify for a loan. To help this process go smoother, start gathering documents and information required by most lenders:
– FICO credit score (the lender will also pull your score, but it doesn’t hurt to check it to make sure you’re within the healthy range of 620+)
- W-2 tax forms and/or 1099s
- A letter confirming any gift funds
- Paycheck stubs
- Recent bank statements
Compare Interest Rates
Don’t move forward with the first offer you receive, even if you feel like it’s the best rate available. Go through the pre-approval process with multiple lending companies to compare interest rates so you can find the best rate—this also won’t significantly hurt your credit score. When investing in such a large purchase, even a half percent difference can help save you thousands of dollars over a 30-year mortgage payment.
Hold Off on Big Purchases
Finally, as you continue the home hunting process and deciding on which home you just can’t live without, be very aware of your spending during this time. Large purchases, such as a car, can greatly affect your chances of actual approval once you decide to put an offer in on a home. If a large purchase is necessary, wait until you have closed on your new home.
Partner with a reliable, local real estate agent at HND Realty LLC to help make the home buying process more manageable and less stressful. Our owners are Nashville natives—so our team knows the area and provides excellent resources for first-time homebuyers. HND Realty LLC is dedicated to creating high-quality homes and communities throughout Nashville and the surrounding areas. Browse our current homes for sale to find your dream home!