What is a mortgage pre-approval?

A mortgage pre-approval is an important step in the process of purchasing residential real estate in New York. Pre-approval means that a lender has evaluated a prospective borrower’s financial information and is willing to lend them a certain amount of money to purchase a home. It is different from pre-qualification, which is a more general assessment of a person’s ability to secure a loan and is not a commitment from the lender. In order to get a pre-approval, borrowers must provide detailed financial information and documentation. This typically includes employment history, income, assets, debt, credit score, and any other relevant information. Lenders then use this information to determine a person’s ability to pay back the loan, including interest rates. A mortgage pre-approval is helpful for both buyers and sellers, as it sets the maximum loan amount and generally streamlines the home buying process. It also lets buyers gauge their purchasing power in the market and determine what type of home they can realistically afford. Furthermore, sellers may be more likely to accept offers from buyers who have a pre-approval, as they have already gone through the process of verifying a buyer’s ability to purchase the home.

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What is a mortgage pre-approval?

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