https://www.youtube.com/watch?v=Jxjw125Vk_w
Introduction:
Chapter 1: The 90-Day Rule: Understanding the Timeframe
So, how long is your mortgage pre-approval good for? Typically, it's valid for approximately 90 days. This clock starts ticking from the initial application date, not from when your file gets approved. This is a crucial point to remember, and it gives you a reasonable timeframe to find your dream home.
Chapter 2: The Pre-Approval Process: How We Do It Differently
Before we get into the nitty-gritty, it's essential to understand how my team handles pre-approvals, as it differs from other lenders. We follow a meticulous process:
Chapter 3: Staying Updated: Keeping Your Pre-Approval Current
What if you don't find a home within the 90-day period? Don't stress! Your pre-approval can be updated. Your credit report is typically valid for 120 days, so there's room to maneuver. We won't re-run your credit without your permission, and we only do it if you're actively looking.
Chapter 4: What Can Affect Your Pre-Approval? Understanding the Factors
Certain actions can impact your pre-approval:
Chapter 5: Communication is Key: Stay in Touch with Your Lender
The key to a smooth pre-approval process is ongoing communication with your lender. If you're planning any financial changes or have concerns, reach out to us. We're here to guide you and protect your credit.
Conclusion: Congratulations on taking the first steps toward homeownership! Mortgage pre-approval is a pivotal part of your homebuying journey, and now you have the knowledge to navigate it effectively. Remember, I'm here to help you every step of the way. Feel free to reach out with any questions or if you need further assistance.
Okay, it's a day in the life of. I got this question on the last three calls: how long is my pre-approval good for? That is a great question, and it's a question that we get every day. So, your traditional mortgage pre-approval is going to last approximately 90 days.
Now, the next question I get is, oh God, do I have to do it all over again? No, so let's talk about how this works. I'm just going to walk you through how my team does a pre-approval, and it is different than other lenders. So it's very important that when you guys are talking to lenders, you know, first of all, call me. I'm licensed in 48 states. But if you're working with someone else, make sure you understand their pre-approval process and how they handle these factors we're going to talk about because it does affect you.
First of all, we would have you fill out our online application. We would get your income and asset documentation and any other documentation that we think we need in order to verify your application. We would run your application through desktop underwriting, which is a computer system that says yay or nay. Then we would submit your file to our processor. Our processor would make sure we have everything we need. They would submit the file to underwriting because we do fully underwritten pre-approvals because I hate risk. So, we would fully underwrite your file, and then you'd have your pre-approval.
Now, your pre-approval is going to be based on that initial application date. It is going to be when that 90 days starts. It doesn't start from when they actually approve the file. It's from the initial application.
Now, the biggest worry people have is like, what if I don't find a house in 90 days? Don't worry about it. If you don't find a house in 90 days, that's fine. Just keep looking and keep us in the loop. You know, let us know if anything changes. Your credit report for most loans is good for 120 days, so we wouldn't be looking at re-running credit until we're at that portion. And if, number one, you give us permission, that's very important. A lender always needs your permission to run credit.
Or number two, you're still looking.
So, for example, when I bought my first house, you know, I would look for six months really aggressively, then I'd get a little heartbroken, take a couple of months off, look again, take months off. Well, if I was in one of those periods where I was taking some months off, there's no point in running my credit. So, it would make more sense, and it does make more sense from the lender's perspective to run that credit again if it's expired, if you're looking.
So, there are some lenders out there that just run people's credit automatically all the time, and I think that's a huge issue. It is unethical, and it's not legal. So, guys, if you have a lender that's like, oh, I'll just run your credit whenever it expires, no, please contact me. You need my permission to run credit. I just want to make sure I'm still looking, etc., etc.
That's fine, but you want to watch out because I did have a couple of people, and I hear this like I get this at least a couple of times a year, where someone says, oh my God, my credit was 700 when I started, but I've been looking for a year, and my brokers run my credit so many times, now my credit score is 660. I'm like, why are they running your credit so much? They're like, they say they have to run it every three months. No, you don't. Okay, so you want to make sure that you're working with a lender that knows guidelines for how long a credit report is actually good for. Very important.
What expires in those 90 days, and why you have that 90-day window on most pre-approvals is your income and asset documentation expires. So, if we just get updated income and assets, we can reissue that pre-approval. Okay, super easy. It's like, send me a month's pay stub, send me this, we're good. If you're self-employed, it's like, send me your most recent bank statements. You know.
Now, it's important to note there are some things that can affect your pre-approval, and I'm going to cover a couple, and then we'll go deeper into that in another video. So, the two big things to know is that if anything changes, okay, you need to tell us. So, a lot of times, people assume, well, I am now pre-approved, so it doesn't matter if I buy a car because they already said I'm good. No, your pre-approval is based on the information that you give us. If anything changes, it affects the pre-approval. So, that's why you'll see on most pre-approvals there's always a line that says, if anything in your financial situation changes, we have the right to revoke this pre-approval.
That's all lenders, okay, because before we close that loan, we're going to have to verify everything again, and if you've bought a car, if you switch jobs, if you quit your job, we're going to find out, and it's going to make that pre-approval void.
Okay, so really important that you know that you're constantly checking in with your lender if you're thinking of doing stuff. If you guys are thinking of buying a car, I love the clients that call me and say, hey Jen, I'm thinking of buying a car, but I want to make sure it's okay first. Thank you for asking me because a lot of times it's not okay. It screws up your loan. So, the next question I always ask is, hey, like how much is that car payment going to be? So, you're going to want to know what the payment would be, and if you're paying in cash, cool, we need to know how much cash. But if it's going to be a payment, I need to know what that payment is going to be so I can put it in your debt-to-income to see if the numbers still work.
Overall, pre-approvals are good for 90 days, super easy for a lender to update. No, you do not have to start from scratch. A lender shouldn't be running your credit without permission. We're only going to run your credit if it's expired and if you're giving us permission and if you're actively looking. But overall, we have lots of clients where it takes one year, two years, three years to find a house. It took me three years. So, we're very used to updating pre-approvals to make sure that you guys are always good and protecting your credit as if it was our own because, as you guys know, credit is king, and we need to protect it like the little baby If you're self-employed, it's like, send me your most recent bank statements, you know, um.