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Here’s What You Need to Be Pre-approved for a Mortgage


There’s nothing wrong with attending open houses and shopping idly for a home. But if you’re serious about becoming a homeowner, you will need to start the process by consulting with a lender. Being a potential buyer yourself, they can help you gain a pre-approval letter which will make home sellers more ready to negotiate with you (since the letter serves as proof that you have financial backing).


Aside from that, pre-approval also makes your house hunting experience a lot easier. For example, if you have obtained a pre-approval amount of $250,000, you will be guided not to spend your time chasing after homes worth more.

So, how do you exactly get pre-approved for a mortgage? Well, to start, you will be needing:

  • A proof of your income If in the past getting approved for a loan required no verification or documentation, now, things are different. In order to succeed in your pre-approval process, you will need to at least secure your W-2 statements (for the past two years), your recent pay stubs (which should indicate your year-to-date income), as well as any other additional proofs of income (such as bonuses, alimony, and a compilation of your recent tax returns).

  • A proof of your assets Your pre-approval depends on a great variety of factors including your credit score, debt-to-income ratio, and other variables depending on the type of loan you have decided to pursue. On top of that, you will also be needing to present your current bank statements, along with any investment account statements you may have to prove that you are able to pay not just the down payment, but also the closing costs and other additional expenses.

  • A better credit score Did you know that the better credit score you have, the lower your interest rates can become? This benefit is usually reserved for individuals who have a credit score of at least 760 or higher. On the contrary, people who have a credit score of 580 or below are usually subjected to make a much larger down payment than most. So, if you plan on getting better rates, it’s never too late to start working on improving your credit score.

  • A whole lot of other documentation While there’s no denying it that working to gain a pre-approval takes a lot of work and effort, it’s not something that doesn’t come with benefits either. Aside from guiding your search for the perfect home, it can also help you manage your finances a whole lot better.

If you’re still a bit confused about loan programs and how exactly mortgage in San Jose California works, don’t worry. You can always reach out to GoldenPoint Finance to help you gain a better grasp of the things you need to understand. Our highly experienced staff will gladly answer any of your questions and guide you through the whole process too, so don’t hesitate to give us a call!

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