7 Thoughts on I was pre-approved for a mortgage, but how do I know if I acutally get the loan?
  1. Reply
    Mortgageman
    October 22, 2012 at 6:20 pm

    Nothing is final until you sign the documents at closing.

  2. Reply
    hirebookkeeper
    October 22, 2012 at 7:14 pm

    If you are approved and decide you want to go with them for the mortgage, they will send an appraiser out to the home and if the home is worth what you want to mortgage it for and meets all of the mtg company’s parameters then a closing will be set and that’s when all the settlement takes place.

  3. Reply
    Country Girl
    October 22, 2012 at 7:57 pm

    You have to find the house you want to buy before they approve your loan. Preapproval is for the approximate amount you can “shop” for a home. Once you find one you like in your price range, then you let the bank know to finalize the paperwork to put the loan through and all the paperwork will be signed at that point.

  4. Reply
    wilderwriter
    October 22, 2012 at 8:33 pm

    You don’t have the loan until you have made a deal on the house you want and the lender (usually, but not necessarily always, the lender who gave you the pre-approval) accepts the deal and makes the funds available. Don’t forget that you have to actually have the pre-approval, not jsut the word of someone who has done a credit check on you. The lender usually grants a pre-approval for any house up-to-a certain value, based on your income and credit-worthiness, but will need to get an official appraisal on the specific house.

  5. Reply
    saberhilt
    October 22, 2012 at 9:06 pm

    If you’ve been pre-approved, then you have not gotten the loan. The loan will not come into play until you’ve found the property, appraisals have been done, and the seller has accepted your offer.

    Make sure that you have a contingency to make buying the home dependant on the loan being approved. This way you can get any ernest money back.

  6. Reply
    Cali-Gal
    October 22, 2012 at 9:33 pm

    These days of uncertainty in the mortgage industry, a preapproval does not carry much weight as far as I’m concerned. Lenders are changing their guidelines every minute because of what’s happening in the secondary market. You will not have a full loan approval until you can provide ALL the conditions that are asked for by the underwriter. Depending on who the lender is funding the loan, there is no guaranty that the lender will be able to fullfill the funding. Read up on American Home Mortgage who just closed their doors on Friday, August 3rd of this year. There were thousands of approved loans that they were not able to fund, so therefore, the potential borrowers had to scramble and find someone else to do their loans. Yesterday, Countrywide (the number one lender in the country) had to borrow 11.5 million dollars so they can still fund loans. If you are going for an “exotic loan” which is anything other that an Conforming Loan with a Fixed Rate, don’t be surprized if it does not go through or that the conditions required by you are rigorous and tough to come by.

    My advice, if you can’t qualify for a Conforming 30 year Fixed Full Documentation Loan….don’t buy a house until you can qualify. If you have at least 20 percent down of your own money seasoned in your bank account for two months or more, chances are there will be no problems in getting a full loan approval. Underwriters favor 20 percent down or more. If you can’t come up with that much, FHA will consider as little as 3 percent with gift funds allowed. I am afraid that 100 percent financing is going out and will eventually become non-existant (that’s my opinion, I could be wrong).

  7. Reply
    godged
    October 22, 2012 at 9:51 pm

    Mortgageman is correct, you won’t “have” the loan until you have closed escrow on the property. All too often, people get pre-approved, find a house, get a contract accepted, then go on a spending spree or change jobs – even worse, quit their job – making them not qualified for the mortgage when the lender checks the information again.

    Pre-approved is good. Ask your lender what the next steps are from here.

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