Before you start shopping for your new Santa Cruz home, take the steps required to get pre-approved for a home loan. Being pre-approved gives you a few advantages when you are shopping for a home:
• You know how much you can afford to pay for a home. This saves you time and reduces your frustration because you can look at only those homes that are within your price range.
• It makes you a more attractive buyer to sellers because they know you can get a loan to purchase their Santa Cruz home.
In order to get pre-approved for a loan, you need to:
• Find a lender. Shop around because terms and rates vary. Getting pre-approved does not obligate you to that particular lender.
• Provide your financial information. Be prepared to supply your annual gross income, current expenses and debts. Give the lender copies of your last two income tax returns, W2 or 1099 statements for the last two years, bank statements (checking and savings accounts) for the last few months, two most recent paycheck stubs or proof of income and any retirement savings account statements.
• Fill in your employer information. You’ll need to give your employer’s name, address and how long you have worked at your current job. If you’ve been at your current job for less than two years, be prepared to provide information about past employers.
• Allow the lender to run your credit report.
Be very precise when disclosing income and debt levels. The lender will verify each item to make sure it is accurate. Misrepresenting information on the pre-approval form will only hurt you in the end.
A pre-approval for a loan is more important than a pre-qualification. A pre-qualification only says you look like you qualify for the loan without any financial information being investigated.
If you would like more information about getting pre-approved for a Santa Cruz home loan, or would like a referral to a lender, feel free to call me at 831.662.6522 or email me at Lauren@LaurenSpencer.com.
For additional information about real estate or loans, please visit my home page at www.MySantaCruzRealEstate.com.