Buying Budget

Buying Budget

What is your home buying budget? The best way to determine your budget is through a pre-approval process. Going through the full documentation and a credit check early in the process will allow you to look for the right homes within your budget from the start.

Pre-Qualification A loan officer can give you an estimate of your home buying ability based on your verbal orwritten word of finances, credit history, and current income. This is, however, an unofficial estimate and does not give you credibility with sellers or lenders.

Pre-Approval Your lender can provide you with pre-approval by analyzing your financial documents, like pay stubs, bank statements, W-2, business licenses, assets and so forth. Based on these documents, your lender will provide a pre-approval letter indicating up to what price point you have the resources to afford.
It is also possible to be “pre-underwritten” before finding the home you want to buy. While being pre-underwritten looks more favorable, sellers want to see you are at least be pre approved.
Checklist for loan-application – including but not limited to:

• 2 years of tax returns, W2s
• If self-employed, 1099s and copy of business license
• Most recent bank statement (all accounts and all pages)
• Most recent pay stub (minimum of 30 days)
• Copy of driver’s license
• Mortgage statement
• Most recent tax statement for all other properties owned
• Divorce decree or separation agreement (if applicable)
• Potential for additional documentation