Most preapprovals are good for 90 days, but some lenders issue 60-day and 30-day limits. Best practice is to get preapproved for a mortgage just before you begin serious house hunting.
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When a lender issues a mortgage preapproval letter, the document will indicate that it is only valid for a limited period of time. Most lenders issue 90-day preapprovals, but each lender sets its own time limit, and letters with 60-day and 30-day limits are issued as well.
Because preapprovals have relatively short shelf lives, its wise to time your preapproval applications carefully so you can use them effectively. Its also important to know how long a preapproval will last before you apply. Heres an overview of how to apply for a preapproval and how to use it efficiently.
Getting pre-approved for a home loan is an important first step for many homebuyers. It shows sellers that you are a serious buyer who has been vetted by a lender. But pre-approvals don’t last forever. If too much time passes between when you get pre-approved and when you make an offer, you may need to go through the process again. So how long are mortgage pre-approvals good for? Let’s take a closer look.
What is Mortgage Pre-Approval?
Before we get into the timeline, it helps to understand what mortgage pre-approval is. Pre-approval is when a lender evaluates your finances and issues a letter confirming you meet their requirements to qualify for a home loan.
The pre-approval letter states the maximum loan amount, interest rate, and other terms the lender is willing to offer you. It doesn’t guarantee final loan approval, but it shows sellers you are financially qualified and can move quickly through the mortgage process.
Pre-approval is different from pre-qualification, which is just an initial estimate of what you may be able to borrow based on limited documentation. For pre-approval, you must submit payroll stubs, tax returns, bank statements, and other verification of your income, assets, and debts.
Why Get Pre-Approved?
Here are some key benefits of getting pre-approved before making offers
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Speeds up the homebuying process. Since the lender already has your documents, final approval goes faster once you’re in contract.
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Gives you a price range. The pre-approval amount helps you set a realistic budget for your home search.
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Shows sellers you’re serious. Pre-approval letters assure sellers you’re able to get financing.
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Strengthens your offer. Sellers may choose the highest offer from the most qualified buyer.
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Locks in current rates. You can lock in an interest rate with pre-approval to protect against rate hikes later.
How Long Do Pre-Approvals Last?
Most lenders issue pre-approvals that are valid for 60 to 90 days. But some last 30 days, while others allow 120 days. The length depends on the individual lender’s policies.
Here are some factors that influence how long pre-approvals last:
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Lender requirements – Each lender sets their own pre-approval expiration timeline. Shop around to find one whose duration meets your needs.
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Loan program – Government-backed loans may have shorter pre-approval periods than conventional mortgages.
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Down payment – Pre-approvals for low down payment loans often expire quicker than those with 20% or more down.
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Your situation – If your finances are volatile, the lender may give you a shorter pre-approval window.
No matter the initial duration, you can usually get your pre-approval extended by touching base with your loan officer as it nears expiration. They’ll just need some updated documents from you.
The Pre-Approval Timeline
Now that we’ve covered the validity period, let’s walk through the full timeline from application to expiration.
Initial Application
- 1-2 days – It takes about one to two business days for the lender to verify your application information, check your credit, and assess your financial profile once you submit all required documents.
Pre-Approval Letter Issued
- Immediately – The lender can usually issue your pre-approval letter as soon as your application is approved. Some online lenders provide instant pre-approval.
Loan Shopping Period
- 45 days – The 45 days after your first pre-approval application is when you can shop for the best rates and fees. Multiple credit checks won’t further impact your score.
Validity Period
- 60-90 days – This is the standard duration of a mortgage pre-approval, subject to the lender’s discretion. Mark your calendar so you know when it will expire.
Options Nearing Expiration
As your pre-approval nears expiration, you have three options:
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Ask for an extension – Your loan officer may be able to renew your pre-approval simply by having you sign updated documentation.
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Reapply – You can go through the full application and approval process again if your finances have changed.
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Lock your rate – If you’re in contract on a home, you can pay a fee to lock in your rate and extend your pre-approval until closing.
Why Do Pre-Approvals Expire?
Mortgage lenders only issue pre-approvals for a limited period because borrowers’ financial profiles can change. Here are some events that could jeopardize your approval:
- Job loss or income decrease
- High balances on credit cards
- Missed payments or new collections
- Large withdrawals from your bank accounts
- New debts like a car or student loan
- Major deposits from an undisclosed source
- Lower credit score
For these reasons, lenders re-verify your information closer to closing to ensure you still qualify for the loan. If your finances look significantly different, your pre-approval is no longer valid.
How to Renew an Expired Pre-Approval
If your pre-approval expires before you are ready to close, you don’t have to start over from scratch. To get re-approved, you’ll just need to submit updated financial documents.
Follow these steps to renew your mortgage pre-approval:
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Contact your loan officer – Let them know you want to renew your expired pre-approval. Provide any missing info.
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Send new documents – Supply bank statements, pay stubs, tax forms and other paperwork from the last 30 days.
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Authorize credit check – Give permission for the lender to re-pull your credit report.
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Review new terms – The lender will advise you if your new pre-approval amount, rate or terms are different.
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Get renewal letter – Once re-approved, the lender will issue a new pre-approval letter with updated expiration date.
As long as your financial situation is substantially the same, renewing an expired pre-approval usually adds only a few days to the process.
Tips for Staying on Track
To avoid scrambling to renew an expired pre-approval, here are some tips for staying on schedule:
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Apply at the right time – Don’t apply too early or too late. ideally, 60-90 days before you plan to close.
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Note expiration date – Mark your calendar so you know when your pre-approval expires.
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Regularly submit updated documents – Provide new pay stubs and bank statements monthly or bi-monthly.
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Communicate changes – Alert your lender to anything that affects your financial standing.
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Lock your rate – Lock in your rate once you’re under contract to extend your pre-approval period.
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Allow extra time – Building in a buffer of a week or two can help avoid surprises.
Alternatives to Pre-Approval
Pre-approval isn’t your only option. Here are two other ways to show sellers you can get a mortgage:
Pre-Qualification
With pre-qualification, the lender provides an estimate of your borrowing potential using limited information. It’s not a firm approval. Pre-qual letters may satisfy some sellers, but full pre-approval is better.
Proof of Funds
For all-cash offers, you can provide bank statements proving you have enough in your accounts to pay the purchase price in full. But a pre-approval still helps should anything happen with your cash.
The Bottom Line
While pre-approvals generally last 60-90 days, you may be on a tighter timeline. To keep your home search moving, monitor your pre-approval expiration date closely. If it looks like it will lapse before you are ready to close, touch base with your loan officer right away to renew for another 30-90 days. With some advance planning, you can avoid delays.
Gather Your Financial Information
Gathering your financial documents—including those related to employment, income and assets—can help your application process go smoothly. Documents lenders typically require include the following:
- Personal information: Youll need to provide your drivers license, passport or other proof of identity. You dont need to be a U.S. citizen to apply for a mortgage. You are eligible for a mortgage as a foreign national if you can prove your residency status.
- Income information: Be prepared to submit recent pay stubs, account statements and your past two annual tax returns.
- Asset and debt information: Youll need to provide your lender with account statements that show your savings, investments, property and other assets. Conversely, your lender will want to see your current credit card, loan and other debt balances. Ultimately, lenders want to see that you have the financial means to cover the mortgage down payment and to help you afford your loan payments if there is a change in your job or income.
What Is a Mortgage Preapproval?
A mortgage preapproval is a document from a lender indicating you are conditionally approved for a mortgage loan—up to a specific amount—to buy a house. It usually specifies the type of loan you qualify for and the interest rate the lender would charge you upon completion of a full mortgage application.
Applying for preapproval is essentially the same as applying for a mortgage. Your lender will assess your income, assets, debt and employment history, and review your credit report and credit score. Keep in mind, preapproval should only be viewed as a preliminary document. This means your lender will not fully approve your loan or finalize terms until they verify information about you and any other borrowers on the loan application as well as the property you wish to buy.
A mortgage preapproval letter is valuable because it attests to your ability to follow through on a purchase offer. It can provide a significant advantage in competitive housing markets: When a seller is considering several similar offers for a home, a bidder with preapproved financing may have an edge over others who do not, on the grounds that your ability to secure financing is more certain than that of rival bidders. In hot housing markets, sellers may only consider offers from prospective buyers who are already preapproved for a loan.
How Long Is My Pre-Approval Letter Good For? (What To Know About Mortgage Pre-Approval 2022
FAQ
Does a pre-approval hurt your credit?
What happens if my mortgage pre-approval expires?
How many times should I get pre-approved for a mortgage?
How long do you have to use pre approval?
When should I get a mortgage pre-approval?
You’re safe to get pre-approved as soon as you want to start house hunting, without feeling like you’ll be tied into financing too early. Start your mortgage pre-approval here Table of contents (Skip to section…) Your pre-approval expired.
How long does a mortgage preapproval last?
Now, regarding the duration of a mortgage preapproval, it can vary depending on the lender.Here are some typical timeframes: – **On average**, a mortgage preapproval typically lasts for about **60 to
How long is a preapproved loan valid?
In most cases, it’s valid for around 60 – 90 days. Your financial situation can change substantially within a few months, and many lenders require you to get preapproved again if you’ve gone beyond the 90-day mark. It can, however, be a good thing for a borrower’s financial situation to change.
How long does a pre-approval letter last?
Getting a pre-approval letter is the crucial first step to house hunting. You can’t make an offer on a home without one. But once you’ve gone through the process, how long does pre-approval for a mortgage last? That depends on the lender. Some mortgage companies will honor a pre-approval letter for up to 90 days. Some, as few as 30.