Are you ready to begin your homeownership journey? Don’t make the mistake of shopping without a pre-approval letter. In this video I’ll discuss what a pre-approval is and why it is the single most important step towards buying a home. 

What is mortgage pre-approval? 

A mortgage pre-approval is a document from a lender conditionally offering you a mortgage. The documents will contain the following information: 

  1. How much home you can afford
  2. A clear break down of your monthly payments
  3. The downpayment amount required
  4. The interest rate you are being offered.

This document is a lender’s promise that unless your financial situation changes by the time of purchase, you will have a loan available to buy the home you love. 

A mortgage pre-approval is different from a pre-qualification, don’t confuse the two. A pre-qualification is based information you provide verbally. The lender does not collect paperwork to verify nor do they run a hard credit check. A pre-qualification only gives you a rough estimate of how much you’ll be able to borrow. 

For a mortgage pre-approval you’ll need to complete a mortgage application, provide financial documents and have your credit pulled. 

Mortgage lenders have different timelines for how long it takes to issue a pre-approval from the point you have submitted all the required paperwork. Some are quick and will have a response for you within hours, others can take up to 10 days. 

And don’t worry about extra hard inquiries on your credit report. When you apply with multiple mortgage lenders in a short period of time (14 to 45 days of each other, depending on a credit scoring model), the credit pulls will count as a single inquiry. 

Why you need a mortgage pre-approval 

You want to get a mortgage pre-approval at the beginning of your home buying journey for two reasons: 

  1. It’s the only way to know how much home you can afford and have clear numbers of the financial commitment to own that home including monthly payments & closing costs
  2. It allows you to submit offers on homes you love

In our competitive SoCal market, most agents and sellers will not consider offers that are submitted without a pre-approval letter. 

How to get pre-approved for a mortgage 

First, check your credit score as it will play a big part in the lender’s decision. You can use a credit monitoring service from your credit card issuer, such as credit Karma. The higher credit score you have, the better the terms you’ll receive on a mortgage. Aim to have at least a 640 before you apply 

Next, prepare the following documents: 

  • At least two most recent pay stubs
  • Tax returns from the past two years
  • Bank statements from the last 60 days
  • Investment account statements, including 401(k) and IRA

It’s best to have all your paperwork ready before you apply — this will save you time on the back-and-forth with the lender. 

Bottom line 

A mortgage pre-approval is the only way to know how much home you can afford and you should not submit offers on a home without. It’s free and at no obligation. It can be done from your computer or in person depending on your preference, and you can shop multiple lenders without hurting your FICO score 


We talked a lot about the process of a pre-approval, but are wondering what the minimum requirements are to apply?

Make sure to watch my video “What are the minimum requirements to buy a home” I’ll link to it here. 


I’m Melissa Urena, Long Beach local and SoCal Realtor. I specialize in helping homeowners like you upgrade from first home to forever home. For more tips on buying and selling, follow my YouTube Channel.


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