Pre-Approval For a Mortgage in Massachusetts Lasts How Long?
Author Bill Gassett owns Maximum Real Estate Exposure.
Once you have decided to buy a home in Massachusetts, one of the first steps will be getting pre-approved for a mortgage. Home sellers and their agents won't take you seriously without pre-approval for a mortgage.
Not only does having mortgage pre-approval make you a valid buyer in the eyes of the folks that matter most, it tells you exactly what you can afford.
There is no sense in looking at homes outside of your qualifications. It wastes your time, and everyone else's in the home-buying process.
We will examine a pre-approval and why it is essential when looking for a home to purchase. You'll also find out how long they last to avoid getting caught with an expired pre-approval letter while looking at properties to purchase.
What is a Mortgage Pre-Approval?
A mortgage pre-approval is a formal and vital step when buying a condo or a house. It is a process in which a potential home buyer provides a lender with financial information to be evaluated and approved for a loan.
The mortgage pre-approval process allows lenders to assess the buyer’s creditworthiness and determine exactly how much they can afford to borrow.
Having pre-approval is essential for potential home buyers for several reasons. One of the main reasons is that it shows sellers and their agents that you are a viable and serious buyer.
A pre-approval demonstrates that you've taken the necessary steps to determine your finances and can purchase a home. Having a mortgage pre-approval is a must when negotiating with the seller. Buyers who have not gotten a pre-approval won't be looked at favorably.
In addition, having a pre-approval helps the buyer to manage their expectations better. When borrowers have gone Through the pre-approval process, buyers better understand how much they can comfortably borrow and the type of home they can afford.
It helps narrow the search and reduces the time and energy wasted looking at homes outside of your budget.
Overall, pre-approval is essential to any home purchase unless you're paying cash. It provides buyers with the knowledge they need to make an informed decision and to demonstrate to sellers and agents that they are serious and viable buyers.
Is a Mortgage Pre-Approval The Same as Pre-Qualification?
No, a mortgage pre-approval is not the same as pre-qualification. Pre-qualification is a much less involved process and is less reliable than a pre-approval.
When pre-qualified, the lender will generally take your word for the financial information you've provided. They will then tell you what you're qualified to purchase. However, they won't verify your employment, income, and credit scores as they would with pre-approval.
A mortgage pre-approval is preferred, given the lender evaluates with proof that you can pay your monthly mortgage payments.
It is essential to note that some lenders use the term "pre-qualification" interchangeably with "pre-approval."
The most important thing for all parties involved in the transaction is whether or not the buyer's financing information was verified. As long as that happens, it doesn't matter what it's called.
Excellent seller's agents will always take the time to look over mortgage letters carefully to vet the buyer.
How Long Will A Mortgage Pre-Approval Last in Massachusetts?
With most mortgage lenders, pre-approval will be good for 90 days. It will be important for buyers to ask their loan officer if that is when it will expire. It's one of the many good questions to ask lenders.
The lender will ensure the buyer still qualifies for the loan amount and that their financial situation hasn't changed drastically. It's essential to remember that lenders may also require a new pre-approval if it's been more than 90 days since the initial pre-approval.
During the pre-approval period, it's crucial to monitor your credit score and ensure no major changes to your finances occur. This will ensure the pre-approval remains valid during the home-buying process.
If you can, getting a good credit score to buy a house will help you get better loan terms. Always continue throughout the process to improve your financial viability. You will be rewarded for it.
You should also realize that the pre-approval is not a guarantee of loan approval. Financial mistakes, such as significant purchases, could increase your debt-to-income ratio and prevent you from purchasing.
How Long Does it Take to Get Pre-Approved For a Mortgage in Massachusetts?
From my thirty-seven years of experience, most borrowers can be pre-approved for a mortgage in a matter of a day or two.
It could take longer if you have a more unique financial situation, especially when a lender needs to document specific aspects of your finances.
Final Thoughts on Getting Mortgage Pre-Approval
Getting pre-approved for a mortgage is a vital step in the home-buying process. Most people involved in the real estate transaction will not consider you a serious buyer until proven qualified.
Remember that getting pre-approved doesn't lock you into a lender. Make sure you do some shopping for a mortgage. Don't settle by going to the first lender you speak with.
The terms you receive on a mortgage will significantly impact your finances for many years to come.
Did you enjoy this advice on how long a mortgage pre-approval lasts? See other real estate articles on NewsBreak for more timely tips and advice. Bill often writes about general real estate, mortgages, finance, moving, and home improvement.