Pre-approval Letters

March 7th, 2022 Posted by florida mortgage 0 thoughts on “Pre-approval Letters”

If you are unaware, pre approval letters typically come with an expiration date. The expiration date varies as it could be 30, 45, 60, or even 90 days. Although the 90 day expiration is very uncommon, it just depends. With the market being as crazy as it is today, you will want to make sure your pre approval letter is current and you have easy access to it in case you have to jump on making an offer for a home quickly.

 

It is important and easier to have a current pre approval letter as it is possible for a mortgage rate to make a significant change, particularly an increase, and with the increase, you may not be able to afford a loan so high. Because of the possibility of the quick rise of mortgage rates, the majority of lenders are decreasing the amount of time a pre approval letter lasts. 

Unfortunately you cannot extend a pre approval letter, but you can renew them. Lenders will require documentation to be re-verified upon renewing your pre approval. For example, your most recent pay stubs and bank statements will have to be submitted again. It is possible for things to change within a short period of time, so you can understand why this type of information needs to be submitted again.

 

The good thing is that there is no limit on how many times you can get pre-approval letters. If you are in the process of house hunting, do not hesitate to ask for a renewal from your lender. The majority of lenders do not charge for a pre-approval letter. If a lender does, they will merely deduct their fee from the closing cost.

 

Depending on the process a lender uses, your credit score may or may not be affected. It depends if a lender makes a “hard” or “soft” inquiry. A “hard” inquiry affects your credit score while a “soft” inquiry does not.

 

Having this pre-approval letter will make your house hunting less stressful and perhaps a little easier. This is especially true if you are in a rush to purchase a home and you want to stand out against others.

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