House shopping. Love it or dread it, if you're reading this you are probably in the market to buy a home. Finding the perfect floor plan with abundant closet space is the goal, but what can you do in the meantime to make reaching that goal a little bit easier? Get prequalified. 

There are folks out there who can write a check for a home. For the rest of us mortals, buying property requires a loan from a bank. Qualifying for a loan from a bank usually requires proof of some sort. What proof? Well, income statements, debt statements, and a credit history are typically considered proof.

What you can do to help speed up the mortgage-qualifying process is get a prequalification letter from your chosen lending institution. This involves forking over the proof paperwork to the bank before, or while, you are perusing listings and comparing closet sizes. So when you find that perfect place for all your belongings, the process of getting a mortgage is already underway. This will save you time after the seller accepts your offer.

A prequalification letter is like a license to buy. When you present your prequal letter with your offer to purchase, sellers know immediately that you are serious and that you're qualified to purchase their home. While prequalification is not a loan guarantee, it is a serious step in the right direction.

Now you've read about some of the benefits of prequalifying for a loan. So, how do you get there? Gather up all you financial statements is the first step. Tax returns or bank statements with deposit records, letters from employers all count toward proving how much money is coming in the door.

Next, run your credit report. If this is something you haven't done in a while, go online and request your credit history from the three big reporting agencies. You are allowed, by law, to request a copy of your report once a year. Free of charge of course. These reports don't typically show a credit score, but you will be able to see if anything shows up in error.

Banks like good credit scores. Those scores give them indication if you are able to pay back this large amount of money you're requesting. If your credit isn't perfect, do what you can today to correct any past errors in spending habits.

Along those same lines is your debt-to-income ratio. Like it sounds, this is the amount you owe vs the amount you make. Like your credit score, banks like nice numbers associated with this calculation. If your debt, from say credit cards, is high, ask your mortgage broker how to lower the ratio. The best way might not be to pay them off, while subsequently draining your down payment account, and cut them up.

Need help choosing a local lender and taking the steps to get pre-approved? Do not hesitate to contact me today. I'm always just a call away and look forward to sharing my knowledge and expertise with you.