How to Get Pre-Approved for a Mortgage - Zillow
What is a pre-approval?

A pre-approval is a preliminary commitment in writing from a lender stating that a borrower would qualify for a particular loan amount based on income and credit information under a lender's guidelines. Most pre-approval letters are good for 60 to 90 days.

Why should you get pre-approved?

There are many reasons why you should get pre-approved early in the process of purchasing a home. The most important reason is that you will get an accurate idea of how much you can afford. This will ensure that you only look at houses that are truly in your price range. A pre-approval letter is also essential in a competitive real estate market. If you make an offer on a house without a pre-approval, your offer will not be taken as seriously as an offer from another person with a pre-approval and you could lose out on the house of your dreams. Additionally most bank-owned homes will require a pre-approval letter from a lender before accepting an offer.

How long does it take to get pre-approved?

In order to obtain a pre-approval letter you will need to contact a lender. Normally the pre-approval process takes 24 to 48 hours to obtain a letter. However using Zillow's new pre-approval tool, you can now get a sharable pre-approval letter within minutes.

How do you get pre-approved?

To get a pre-approval letter, a lender will ask you for your Social Security number and permission to pull your required credit report for you and your co-borrower (if you have one). Most lenders charge an upfront fee of around $30 for this. However, by using Zillow's pre-approval tool, your credit pull is free. Rest assured that Zillow uses state of-the-art technology to protect your personal information and only shares it with the lender you select.

What if you can't get pre-approved?

There are three areas you will likely need to work on if you are not able to get pre-approved from a lender.

  • 1. Correct any errors on your credit report, which could help to raise your credit score. The lender will analyze your credit report for any red flags, such as late or missed payments or charged off debt. Your credit score will affect your ability to qualify for a loan and determine how low of a rate you can get. Generally a score above 720 will get you the most favorable mortgage rates.
  • 2. Decrease your overall debt and improve your debt-to-income ratio. In general, a debt-to-income ratio of 36 percent or less is preferable and 43 percent is maximum ratio allowed. Use the debt-to-income calculator to determine your ratio.
  • 3. Increase your down payment amount in order to qualify for the house you want. Learn more about down payments

Be sure to ask your lender for tips on how you can improve your chances for qualifying for a loan.

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