How to Get Pre-Approved for a Mortgage

Buying a home can also be overwhelming, especially when it comes to financing. One of the most important steps you can take before starting your house hunt is getting pre-approved for a mortgage. Not only does this process give you a clear picture of what you can afford, but it also makes you a stronger buyer in the eyes of sellers.

If you’re preparing to buy a home, here’s everything you need to know about how to get pre-approved for a mortgage.

What Does Mortgage Pre-Approval Mean?

A mortgage pre-approval is a lender’s conditional agreement to loan you a specific amount of money for a home purchase. It’s based on a review of your financial situation, including income, credit history, assets, and debts.

Think of it as a green light from the bank: it shows sellers you’re serious and financially qualified. Pre-approval is different from pre-qualification, which is more of an estimate based on self-reported information. Pre-approval requires documentation and is a stronger indication of your buying power.

Step 1: Review Your Credit

Your credit score will have a big part in determining the type of loan you qualify for and the interest rate you’ll receive. Before applying for pre-approval, request a free credit report to check for errors or potential issues.

If your credit score is lower than where you want it to be, consider taking steps to improve it, such as paying debt, making on-time payments, and avoiding new credit inquiries. A higher credit score can save you thousands over the life of your loan.

Step 2: Gather Financial Documents

When you apply for pre-approval, lenders will ask for documents to verify your income, assets, and debts. Having these ready will speed up the process. Typically, you’ll need:

• Recent pay stubs (usually the last two)
• W-2 forms from the past two years
• Tax returns for the past two years (if self-employed, full returns with schedules)
• Bank statements from the past two to three months
• Documentation of other assets (investment accounts, retirement funds, etc.)
• Information about debts such as credit cards, car loans, or student loans

Being organized can make a big difference. It shows lenders you’re prepared and reduces delays.

Step 3: Determine Your Budget

Just because a lender pre-approves you for a certain amount doesn’t mean that’s what you should spend. Consider your comfort level with monthly payments, as well as other expenses like property taxes, homeowners insurance, and maintenance.

A good rule of thumb is that your monthly housing costs (mortgage, taxes, and insurance) should not exceed 28–30% of your gross monthly income. Understanding your personal budget helps ensure you don’t overextend yourself.

Step 4: Shop Around for Lenders

Not all lenders are the same. Some lenders may offer better interest rates, lower fees, or programs tailored to first-time buyers. Take time to compare at least three lenders before choosing where to apply.

Ask about:

• Current interest rates
• Loan options (conventional, FHA, VA, USDA, etc.)
• Closing costs
• Processing timelines

Shopping around not only helps you get the best deal but also gives you a sense of which lender you’ll feel most comfortable working with.

Step 5: Submit Your Application

Once you’ve chosen a lender, you’ll complete a formal mortgage application. This can usually be done online or in person. You’ll provide all your financial documents and give the lender permission to check your credit.

At this stage, the lender will review your information and issue a pre-approval letter if everything checks out. This letter states how much you’re approved to borrow and is typically valid for 60 to 90 days.

Step 6: Use Your Pre-Approval to Strengthen Your Offer

Having a pre-approval letter in hand makes you a stronger buyer, especially in competitive markets. Sellers and their agents often prefer working with buyers who are pre-approved because it reduces the risk of financing falling through.

When you find a home you love, you can include your pre-approval letter with your offer to show you’re ready and able to move forward quickly.

Step 7: Keep Your Finances Steady

After getting pre-approved, it’s important not to make any big financial changes before closing on your home. Avoid:

• Opening new credit accounts
• Making large purchases (like a car)
• Switching jobs
• Missing payments on existing debts

Lenders will re-check your financial situation before final approval, and sudden changes could put your loan at risk.

Final Thoughts

Getting pre-approved for a mortgage is a necessary step in the home-buying journey. It gives you a clear financial picture, helps narrow down your search, and positions you as a serious buyer when making an offer. With preparation and the right guidance, the process doesn’t have to be stressful.

If you’re planning to buy a home and want a knowledgeable professional to guide you through every step, Mahdi Salarfar with the Alpha Realty Team is here to help. From connecting you with trusted lenders to finding the right property, Mahdi ensures the buying process is smooth and successful.