How Long Do Mortgage Pre Approvals Last

If you’re looking to purchase a home for the first time, you may already be aware of the numerous steps involved, from saving for a down payment to learning about your mortgage options. Obtaining a mortgage preapproval is one of those steps.

Congratulations if you’ve already submitted a mortgage application and received a mortgage loan preapproval letter; this demonstrates to sellers that you’re serious about buying a home and that your financing is in order. But how should you use that letter, and how long before a mortgage preapproval expires? Let’s find out.

90 days

What Is a Mortgage Preapproval?

A mortgage preapproval is a letter from your mortgage lender that details the type of loan they are offering as well as the amount they are willing to loan you. They’ll decide how much of a home loan they’re willing to lend you after gathering information about the total amount of debt you’re carrying and comparing that to your assets and current earnings.

You may have heard of a prequalification for a mortgage, which is distinct from a preapproval. When looking for a home, mortgage prequalification comes before preapproval and is more of an estimate of your affordability without a thorough examination of your financial records. Learn more about the distinction between prequalification and preapproval.

A mortgage preapproval in your possession puts you on the right track to purchasing a home and lets potential sellers know you mean business. Lenders will evaluate your financial situation when you apply for a preapproval to determine the price range for your home loan that they believe you will be able to afford. They’ll request these and other financial records from you like:

  • Credit reports
  • Pay stubs
  • Tax records
  • Bank accounts
  • Credit card debt details
  • Student loan debt details
  • Other financial obligations
  • Records on assets like stocks and bonds
  • 401(k) retirement savings records
  • Your finances, income, debt, assets, and credit history will all be closely examined by the loan officer assigned to your request. This will assist lenders in calculating your debt-to-income ratio, which the bank will use to determine the monthly mortgage payment amount you can afford for the home loan. If you choose to apply for a mortgage with that group, the interest rate you receive will also be based on the information provided.

    Why Do You Need a Mortgage Preapproval Letter?

    You’ll receive a dated letter from the lender once you’re preapproved for a mortgage, which you can present to sellers if you want to make an offer on a house. It will list the loan amounts you are preapproved for and might draw attention to the loan’s terms and conditions. What is a preapproval letter used for? The following are its main advantages:

  • It shows a seller that you have a lender who is willing to work with you
  • It validates that you can afford their house
  • It’s proof that your finances are in good shape and you likely won’t be denied a mortgage
  • It gives you an advantage over other buyers who may be interested but don’t have a preapproval letter
  • It can fast-track your mortgage application because the lender’s underwriters will have direct access to your records
  • How Do You Get a Mortgage Preapproval?

    You must schedule a meeting with a lender at a bank or finance company to obtain a mortgage preapproval, though some financing companies may allow you to apply online. You’ll want to have the following on hand:

  • Social security number
  • Driver’s license, passport or state-issued picture ID
  • Proof of employment and proof of income/additional income (e.g. recent paystubs, W-2 forms)
  • Tax documents (last two years of federal income tax returns)
  • Place of residence
  • Bank statements
  • Other assets
  • Real estate records
  • Credit information
  • Debts
  • Monthly expenses
  • It’s crucial to remember that your lender conducts a “hard inquiry” when they check your credit. This could temporarily lower your credit score, but typically not more than a few points. Because of this, if your applications are submitted within a few weeks of one another, you can obtain multiple mortgage preapprovals without suffering a great deal of damage to your credit.

    How Long Does it Take to Get Preapproved?

    If you apply with your lender and have all the necessary documentation on hand, you might be able to receive the preapproval the same day. But remember, everyone’s finances are different.

    The length of time it takes to get preapproved for a mortgage will depend on factors such as your debt, credit score, and other financial difficulties. Your best option is to contact your lender prior to the meeting and ensure you have all the paperwork they’ll need.

    When you’re ready to start looking for a home seriously, do your research on finding a lender and get your preapproval letter in hand.

    Does a Preapproval Letter Expire?

    You might be wondering how long your preapproval letter will last once you receive it. Consider all the various ways your finances could change as a result of receiving your letter, including your income, credit history, and interest rate. Because of this, a preapproval for a mortgage typically lasts 60 to 90 days.

    When it does, you’ll need to get in touch with your lender once more, bring any updated documentation, and request a new preapproval letter. The good news is that since they already have most of your information on file, this usually doesn’t take too long. But keep in mind that applying again necessitates another hard inquiry on your credit report, which could further harm your credit score.

    Want to Learn More About Buying a Home?

    Our first-time homebuyers’ guide walks you through each step of the process, from saving for a down payment to what to do after closing.

    Don’t forget that getting the right insurance is a crucial component of purchasing a home. Your mortgage lender may suggest an insurer, but it’s up to you to choose the one that best suits your needs, which is where we come in. At American Family, you can manage your insurance costs by creating a homeowners policy that’s tailored to your needs. Contact us right away, and one of our agents will be happy to discuss the best ways to safeguard your hard-earned dream.

    Related Topics: Owning A Home


    Do pre-approvals hurt credit score?

    The short answer is no, receiving a prescreened, pre-approved offer won’t harm your credit. This is due to the fact that a prescreened pre-approval entails a soft inquiry, which has no impact on your credit scores. Lenders use the prescreen soft inquiry to simply see if you might be eligible for their credit card offer.

    How long are pre-approvals valid for?

    Letters of pre-approval are valid for 60 days after they are issued. With underwriter approval, they may be extended for an additional 30 days. A new letter will need to be issued if more than 90 days have passed and updated documentation is needed.

    Is it OK to get multiple pre-approvals for a mortgage?

    The use of multiple credit checks for the same purpose, such as mortgage preapproval applications, won’t have a negative impact on your credit score. As long as they are performed within a reasonable timeframe.