These web-based forms typically ask for monthly income, down payment amount, and estimated monthly debts. But when you start with the pre-approval, you'll have a pretty good idea what you can afford -- or what the lender says you can afford, anyway.
The next stages are the loan application, document submission, credit check, appraisal, and underwriting usually in that order. If you have an existing relationship with a bank, you could start there as well. But you will probably have to follow it up by sending your financial documents. Lenders use the online process just to get the ball rolling. Some lenders advertise their pre-approval process, while others might require a little research.
But it's a good way to get the ball rolling. The idea is to get a rough idea what you can afford, and then shop within those parameters.
You'll find the answer below. Good question. Getting pre-approved for a home loan benefits you in several ways.
How is it different from pre-qualification? Do you know someone who has purchased a home recently? You'll face a secondary review process later on, in order to get your final approval. You can choose from banks, both local and national, credit unions, and special online lenders.
Pre-qualification starts the flow of documents between you and the lender, which is a necessary step toward loan approval. Put yourself back in the seller's shoes for a moment. Reader question: In other words, you're a serious buyer!
If your credit score is too low, or you have too much debt, you'll find out about it during pre-approval. It only makes sense when you think about it. Even if you choose a used car, you may not have enough cash on hand to pay for the car outright.