Steps in the Mortgage Pre-Approval Process

Reader Question: I've never owned a home before but will have a chance to in the spring of 2009. My credit score is fair, I don't have any credit cards and I'm paying more in rent then if I owned a home. How do I know who to trust as far as getting a pre-approval mortgage, and what are the steps involved?

With the ever-changing economy, the confusion about mortgage requirements, and the banks that continue to fail, I can understand your concerns. When buying a home for the first time, it can be hard to put your trust in a lender when the process is so new to you.

If you currently have an established relationship with a bank, I would start there. They will be able to give you a quick overview of their mortgage loan programs and rates. If you can provide them with a signed application, pay stubs, tax returns and statements (for things such as retirement accounts and investments), they will be able to pull your credit and consider you as a mortgage candidate. Based on this review, they should be able to quickly make a decision as to whether or not they can pre-approve you for a mortgage loan.

If you do not have a particular bank you regularly deal with, you may want to work with a known and trusted source such as Lending Tree. They will send your mortgage application to as many as four financial institutions, and in return you will receive competitive quotes for a mortgage loan program. Once you decide which will offer works best, you will be on your way to home ownership.

Related Article:

• Get Online Quotes From Trusted Lenders
• Getting a Mortgage Loan in 2009

Hope that helps. Good luck with your home buying process next year!