In most cases an appraisal is not needed. The value can be determined by the lender using an electronic evaluation. If an appraisal is needed, some lenders will pay for it, in some cases it is the clients expense. In a case where the appraisal is lower though the lender will calculate the application on the lower amount. You will still get a mortgage but it does change the calculations, so 10% downpayment might now be 8.5% downpayment. Each deal is different. Check with your Broker.

Probation is not a problem if your closing date is after you come off probation. Also some lenders will allow probation if you are in the same field as your last job. Also if you are employed in your field of education that helps as well.

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I went to a mortgage broker and he gave me a pre-approval (not a pre-qual). went to look at houses over a 2 month period after that. put in an offer on a house, the offer got accepted, i got the house inspected, etc. lender denied me for the mortgage, even after the broker gave me the pre-approval. do i have any legal recourse to recover the hand money i put down and reimbursement for the house inspection? total costs are $1,400.

Just went through the home buying process myself... I doubt if you have any recourse... the broker just gathers the info. for the underwriter as they have the final say... Sorry but you are most likely out $1,400....

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Hi all! my husband and i are looking to purchase our first home soon, and we've been speaking with 2 lenders (a mortage company and a bank that does mortgage lending). we're also working with a realtor. we found a house online last night and are very interested. we are hoping to have our realtor set up a showing within the coming week. my question is: we are currently talking with 2 lenders to see what both companies have to offer us. we're meeting with one tomorrow, and the other next friday. can we be pre-approved from both lenders at this time, so if we like the home we can make an offer, then choose which lender to use at a later date? or do we have to choose a lender now and only get a pre-approval letter from them and not the other company as well? thanks for your help in advance!! :)

Yes, you can be pre-approved at 2 lenders at the same time. Until you sign the mortgage, you're not tied into any leder (although some will charge you an application fee of a couple of hundred dollars to start the application process). Best of luck with your purchase!

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We gave our credit union all of our credit information (w-2's, pay stubs, bank statements, tax returns, etc.). they've said by telephone they would approve us for even more than the amount we're interested in borrowing, but they're asking us to begin negotiations with a realtor about a property we're interested in before they will give us a pre-approval letter to take to the real estate agent! (we haven't started to work with a realtor yet). we feel like it's a catch-22, because usually a realtor wants a pre-approval letter before negotiations even begin. why would they need specific property info for a pre-approval letter which is not binding on them anyway? in fact, there is such a thing as a mortgage for a land/lot loan. interest rate is 7.0% for a mortgage on the unimproved lot. we have filled out a complete application. we were told it would work just like a preapproval letter for a house, so if we wanted to keep looking, we did not have to reapply for a loan on a different property if we found one.

A couple of reasons: The approval is likely contingent on you buying a lot with utilities, sewer, etc. The situation will change if you want to buy a parcel that does not have water, electric or sewer to it. A good Realtor will not require a pre-approval letter before working with you, but they may call your lender and ask about the parameters of the loan program. You actually would prefer to have a pre-approval letter geared to the exact property you are making an offer on, since any open letter now would have the highest dollar amount that you could qualify for. Wait to get the letter until you know the price of the property you are bidding on, otherwise the seller will know that you can qualify for more.

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We were pre-approved for a home loan. we found a house and are scheduled to close in about 2 weeks, but we still haven't received a final approval from our lender. we're getting nervous. is it possible that we might be denied even though we have a pre-approval for almost $20k more than the house we're purchasing? 40%? please tell me where you got that statistic. the application has been with the processor all week and will be sent to the underwriter either today or monday.

You can be denied. They take your word for things for a pre-approval, nothing was verified, and only a basic credit check was done.

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I'm a first time home buyer, my wife is not. she has no negative issues with her last house. i have never had bad credit because i've never had any credit until recently when she added me to her credit cards. one which is now paid off and the other with a balance of $7,500. were pre-approved for $269,000 but only need 218,000 with 7,000 down and 3,000 for closing, both of which will be borrowed from 401k. 401k has 23,000. we bid on 1.1 acres of land for 100,000 plus cut the seller of the land a check for $500 which will be applied to settlement costs. 2 weeks later we signed a construction agreement for building the house we picked out. today we go to the bank for the loan application and have to cut another check for $350 which from what i understand is non-refundable. my question is are the chances of us getting approved from the lender favorable or not? my wife has excellent credit and i have a little credit now. our gross income is around $70,000/year.

Dear djskooby The first thing that will help you is... always remember that obtaining a loan is a: process You already have your pre-approval, and there are still many hoops to overcome. The lender will still need to review all the documents to support the information that you provided on the loan application. If all meets with their criteria you there should be no problem in getting your loan. Best of Luck Daisy

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Recently i found a house and planned to buy it. he already got pre-approval from the mortgage company. the broker told me the worse interest rate i will have would be 8.5% since i had bankrupcy within 2 years and has back childsupport judgement (about 10k and i have been paying on it). today the mortgage company told me that they found 2 lenders for me and one of them is 100% loan with 9.5% interest rate and the other one is 80/20 loan with 8.5% interest rate on the 80 and 12.9% for the 20. i dont understand why the broker told me that i will not get any interest rate higher than 8.5% and now the story totally changed. i already found a house and am happy to get it but i really cant afford the payment with 9.5% interest. the loan i am supposed to get is 85k and with the 9.5% interest, i will need to pay about $700 a month on house payment. i dont know if the broker is not lying to me or he is not trying to help me find a better rate? besides, why do i need to pay $3000 on closing cost? my broker also told me not to try to get a quote from other brokers because once they run my credits, it will hurt my current interest rate and credits. she said since my credits are on the edge and dont not try to run the credits or i will lose the loan (9.5%). is is true or she is trying to scare me not to find a better broker?

Chances are the broker is not being completely honest with you. He quoted you an initial rate of 8.5 and if he a good enough he will do what he can to get you that rate. Brokers tend to overstate the loan interest rate initially to make money on the "back end" of the transaction know as points or Yield Spread Premium. This is money they get from the lender to sell you the higher rate rather than giving you the lowest rate possible. Ask your broker if this is the case. If so explain that you are looking for the lowest rate possible and his job is to get that for you. It sounds like a difficult situation in generally and if he was able to get you a loan in the first place it seems he did his job. Paying $3000 in fees is quite reasonable as I would charge you maximum Federal allowable fees if I knew that the situation is as hard as yours. People that are not in the lending industry tend to think that their broker just collects paperwork from you and sends it in to the lender. There is actually a long drawn out process to get things approved by lenders and with a situation like yours it tends to be more work as there are more conditions from the lender and you don't always get approved with the first lender your file gets sent to and could take many hours processing the loan.

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My builder wants a letter of commitment from the lender for the property, which is more than a pre-approval....but the property is not going to be done for another 9 months...sooo...getting a letter of commitment requires me to get into a long-term commitment (at my cost) with a lender! they only let you lock a rate for 2 months max..otherwise you pay extra. so wtf...what can i do until the time is really needed to get a loan can you ellaborate on that letter of intention?

The builder is looking for a commitment. That means that they have pulled your credit report, taken a FULL loan application and have done some type of review. The commmitment will list all the conditions of the loan. Why would a builder want this. The same reason you as a home seller would want this, along with a large deposit - because they want to make sure that you qualify. What happens if the rates increase in the 9 months? The lender will put you into another program. I'm SURE that this is written in the contract. You are NOT locking into a interest rate. The contract would state, "prevailing rate at the time of settlement". In addition, it will state that you will work with the lender to get a loan. READ THE CONTRACT. The builder isn't being unfair. They are spending $$$$$ to build the home on a promise and your deposit. They want to KNOW that you qualify. If you want to lock into the interest rate, I know that lenders are offering up to 1 year "FREE" interest rate locks. You pay a deposit up front, usually one point and when you settle you get the full deposit back. Usually if rates drop, you can float down to the lower rate one time. for free. In regards to the "mortgage broker" who states that a construction loan is safer: under a construction loan, the buyer actually owns the house under construction. The builder only gets paid for work done. However, the buyer is on the hook for every penny- so if the house is delayed or etc, the buyer pays interest carry every month. NOT A SMART WAY TO GO in this case. In regards to the lender that says that a loan commitment is like a loan pre-qual and that he just writes them for 'fun'. This type of lender will burn you!!! I promise that the builder will hold you to the contract, no matter what. This type of BS is the reason that builders want you to use their "approved" lenders so that when a letter of commitment is given, EVERYONE (you and the builder) is both protected. Shame on this lender!!

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If my credit score is low can i get a home loan? see, i got a pre-approval letter for a home loan and was...quite surprised. 2 years ago a lender said i couldn't finance a pack of pencils. so how did i get a pre-approval letter? i don't know my credit score but 2 years ago it was 554 and i don't use my credit at all. i don't have any credit cards or loans. i just sat on my credit and did nothing. so im confused -does that mean my credit score is up since i got a pre-approval letter? i was told by a realtor that i cant finance a home with a score less than 670. the lender has also verbally told me that with a usda loan in georgia at the current interest rates my payments would be below what im paying for rent 895, on a 119, 000 home with 100% financing and no cash down. but i was told by a mortgage broker that the interest rate would increase my monthly payment depending on my credit score. please help....i really want this house but im afraid to toss up ernest money and loose it if i back out because i cant afford the monthly mortgage -or that they will change there minds and say i cant finance a pack of pencils. ive been looking for 6 weeks knowing i had an approval letter but only recently became more concerned about my credit score because of they info i was told about increase in payment if my score was low.

Your pre-approval depends on how you got it. If it is a letter that came to you in the mail from a mortgage lender, this is not a pre-approval this is an advertisement gimmick used by mortgage brokers/bankers with the hope of getting you to apply for a mortgage loan. If this is the case you might contact these individuals and inquire of their requirements for a pre-approval with their mortgage company. If you went to or contacted a mortgage company with the intent of getting pre-approved for a mortgage loan and you provided this mortgage company with proof of income, bank statements that showed the proper reserves, the mortgage company was able to obtain a credit report and other documents that would allow them to obtain a pre-approval letter that you are requesting. Then this letter of pre-approval is good, because you have spoken with the mortgage consultants that issued the pre-approval letter. Some government agencies such as FHA and VA that underwrite mortgage loans are not as stringent as those of the conventional lenders, therefore you credit score might meet their requirements for a pre-approval for you to purchase a home. I hope this has been of some benefit to you, good luck. "FIGHT ON"

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The lender told us when we wrote up this offer on this house to put a closing date of 2 weeks later, which i thought was pushing it, but now we had to sign an amendment to extend the date , to possible 2 -5 days later. and also we have not received a committment letter from the bank, which makes me worry. i hate to go this far in the process to not have a committment letter. and i said to the lender, why have we not received the committment letter, and he said the realtor has your pre-approval. but i think this late in the game the committment should be there.

The bank has told you that the realtor has the preapproval. This means that, at the closing, you'll be signing the loan papers. Your realtor has already done this work for you. The fact that you don't have a loan commitment letter in hand is not a big issue. If there was any problem with your loan going through, the realtor would have called you and cancelled the closing. Congratulations on your new house! Be prepared to sign your name dozens of times. Draw a deep breath. This is finally it! Yay. - Stuart