When you shop for clothes or a vehicle, do you open your wallet before checking the price tags? Very few of us can afford to do that. Yet, many people go house hunting without knowing how much they can afford to spend. You can avoid wasting time and potential disappointment and by getting pre-approved for a mortgage before you start house hunting.

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What is a mortgage pre-approval letter? And where can I get one?

• This pre-approval option is for qualifying borrowers whose property is yet To Be Determined (TBD). **
• Not all lenders offer pre-approvals, but HMA is proud to be one that does.

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What are the benefits to receiving a pre-approval?

• You’ll be able to focus your efforts on homes with prices that don’t exceed the amount you’ve been pre-approved for.
• You can plan ahead for other monthly expenses based on anticipated mortgage payments.
• You’ll have greater negotiating power when bidding on properties. Sellers know they can count on a faster – and more solid – sale with pre-approved buyers.
• The path to closing is typically faster. Since you’ve already completed nearly all of the paperwork, you’re on the fast-track to closing.

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What’s the difference between pre-qualification and pre-approval?

• Pre-qualification is a verbal, tentative estimate of how much you’d be able to borrow. This exploratory review is usually free, but it doesn’t have as much “teeth” as a pre-approval does.
• Pre-approval is the first step toward your full mortgage application. It requires comprehensive documentation and generally incurs a fee.

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What do I need to provide when applying for a pre-approval? **

• Authorization to pull a credit report.
• Driver’s license or other government-issued ID.
• At least 1 month of pay stubs.
• 2 years of W-2 and/or K-1 forms.
• 2 years of Federal income tax returns.
• Proof of other income you plan to use for mortgage qualification such as rental income, child support and social security payments.
• Statements for assets including bank accounts and mutual funds.
• Signed gift letter(s) if those funds will be used for a down payment.

1 TBD Pre-Approval is for qualifying buyers whose property has yet To Be Determined. Final approval is subject to appraisal, contract and other related documentation.

2 Qualifying documents include, but are not limited to: pay stubs, W2 forms, and other documentation that substantiates the borrowers’ income and debt obligations derived from assets, self-employment and any other documentation that Gibraltar Mortgage Services, LLC requires. Final approval is subject to appraisal, contract and other related documentation. The above-listed items are typical, but may not represent all documentation needed. These are required for all borrowers and co-borrowers.

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