Sunday, February 24, 2013

Does it Cost Anything to Get Pre-Approved for a Mortgage?

We are often asked if it costs anything to get pre-approved for a mortgage. 

The answer is NO, it shouldn't cost you anything.  There should be NO charge to pull your credit, and there should be NO application fee.  If a lender charges you an application fee, they are trying to prevent you from shopping around for the best deal.

The pre-approval process is free and easy.  Here's what happens:
  • The lender gets some housing and financial information from you.  This can usually be done in about 15 minutes on the phone.  Never complete a loan application yourself or fill one out online.  You will probably make mistakes and it is a huge waste of your time to do it yourself.
  • The lender then pulls your credit.  This takes about a minute.
  • Next, the lender enters all of your information into an online underwriting software program provided by Fannie Mae or Freddie Mac and the software tells the lender how much you are pre-approved for.
  • Then, the lender checks the underwriting guidelines of the individual investor who will sell you the loan, to make sure that there aren't any additional guidelines that are stricter than the Fannie Mae or Freddie Mac guidelines.
  • Finally, the lender checks the underwriting guidelines of the mortgage insurance company that will insure your mortgage.  This only needs to be done if the loan is a conventional loan (not an FHA loan or a VA loan) and if you have less than 20% down.
  • Once the lender knows that you are pre-approved to get a mortgage and that the underwriting guidelines for Fannie Mae, the individual lender, and the mortgage insurance company have all been checked, you can shop for a house with confidence, knowing that your loan meets all the current guidelines.
 Need a pre-approval for a mortgage?  Give us a call and we'll get started.

Getting a loan approved is easy - if you know what to do.  The Mortgage Experts know what to do!!!

Make sure you check out our web site:

By the way, don't forget to refinance your current mortgage.  Rates are very, very low right now.  Don't miss out!  Call us today to get the details for your particular situation.

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