Seeking to get a prequalification for a mortgage is a great first step towards your dream of buying your own home. While prequalifying does not guarantee you will get a loan, it does take a lot of the guess work out of the process by defining your purchase limits. Actual mortgage amount is approved after careful assessment of your credit scores, total income, bank statements, and amount you can pay as down payment.
Mortgages for buying homes are provided by a variety of lenders such as banks, credit unions, trust companies and even companies that specialize in mortgages. Free assessment for prequalification is becoming the norm and more lenders can provide a preliminary assessment in no time by answering some questions on online questionnaires. Upon payment, some lenders will go ahead and verify credit scores, income sources, and bank statements and complete any other required documentation for loan application.
Once you have a prequalification, you can go ahead and find a home in your financial range. The house must be appraised for the bank to ascertain its market value and professionally inspected for any hidden issues. These steps can significantly reduce the time to complete the closing on a house.
As with all purchases, you must shop around and reach out to several lenders to get the best possible rate. This process can be facilitated by acquiring the services of a mortgage broker. Brokers do not lend money themselves but help you borrow money from banks by facilitating the transaction from a lender. Good mortgage brokers know the market and can help you choose from a greater variety of loan products and terms and conditions.