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Step 5: Get Pre-Approved

A pre-approval verifies your income, assets and credit so sellers take your offer seriously.

A pre-approval is a lender's conditional commitment to lend up to an amount, based on documents you've provided and a credit check. It's what sellers want to see with your offer.

Pre-qualification vs. pre-approval

  • Pre-qualification is an estimate from numbers you report. It's instant and doesn't verify anything.
  • Pre-approval verifies income, assets and credit, and usually runs your file through automated underwriting. It's much stronger in a negotiation.

Unbeatable shows your estimated buying power right away. When you're ready to make offers, move to a full pre-approval.

Documents to have ready

  • Two recent pay stubs and two years of W-2s (or two years of tax returns if self-employed)
  • Two months of bank and investment statements, every page
  • Photo ID
  • Explanations for large deposits, gaps in employment or past credit events
  • For VA: your Certificate of Eligibility or DD-214

One application, many lenders

Unbeatable is a licensed mortgage broker. Your application goes to a network of wholesale lenders, so you don't fill out a new application for every quote.

Your pre-approval letter

The pre-approval letter states the program and maximum price you're approved for. Tips:

  • Ask for a letter matched to each offer price, so you don't show the seller your full maximum.
  • Most pre-approvals are good for 60 to 90 days, because credit reports and pay stubs expire.
  • Don't change jobs, open credit or make large purchases until after closing.

A pre-approval is not a final approval or a rate lock. Final approval comes in underwriting, after the home is appraised.

Next: find a home.

Your next move, by loan program

  • Conventional: Conventional pre-approvals run through Fannie Mae's or Freddie Mac's automated underwriting, which sets your maximum ratios and the documents needed. Start my pre-approval
  • FHA: An FHA pre-approval runs through FHA's automated scorecard. Have two years of employment history and an explanation ready for any credit events. Start FHA pre-approval
  • VA: Request your Certificate of Eligibility early. Your lender can usually pull it online in minutes. Start VA pre-approval
  • USDA: USDA counts all household income for eligibility, not just the borrowers', so list everyone who lives with you. Start USDA pre-approval
  • Jumbo: Jumbo pre-approvals often need two years of tax returns and full asset statements, even for W-2 borrowers. Start jumbo pre-approval
  • Investor: For DSCR, the property qualifies the loan, so pre-approval focuses on credit, reserves and your down payment. Start investor application