Buying a home is one of the biggest decisions you’ll ever make — and being prepared ahead of time with a preapproval letter can make the process a lot smoother. Getting a mortgage preapproval gives you a leg up in the buying process by showing how serious you are about purchasing a home and how much you can borrow.
Your lender will need some key information for you to get preapproved, such as proof of assets and income, credit history, and employment verification. Lending standards for new home buyers are tougher than they’ve been in years due to the pandemic’s impact on employment and the economy.
These tightened lending standards make it all the more important to stay on top of your mortgage preapproval. “People are going on furlough and losing their jobs, so it’s affecting the preapproval process. Extra overlays on top of traditional guidelines are happening now more than ever now because of COVID-19,” says Chris Devin, branch manager at CrossCountry Mortgage in Norwell, Massachusetts.
There are also implications to keep in mind even if you’ve already been preapproved for a mortgage. Things are moving quickly in the mortgage industry, so you’ll be wise to keep close communication with your lender to make sure you stay aligned. “If you’re already preapproved, make sure you’re checking with your lender that you [continue to] meet the guidelines,” says Devin.
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