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One of the most common tips offered to potential buyers is to get pre-approved for a mortgage. However, many buyers don’t know how long the pre-approval process takes and how it can reduce their home hunting time.
Here’s what you can expect when you get pre-approved for a mortgage, including the time it takes to get that pre-approved letter:
How mortgage pre-approval works
Mortgage pre-approval confirms your creditworthiness for a home loan. When you get pre-approved, you receive a letter from your mortgage lender stating how much you can borrow to buy a home.
Although a pre-approval does not guarantee full approval, it is a fairly thorough process that can give you some peace of mind and make you a more attractive buyer.
A mortgage pre-approval is different from a mortgage prequalification:
- Prequalification: The lender looks at your financial situation based on the information you provide and gives you a rough estimate of the mortgage amount you qualify for.
- Pre-approval: This process is more complex. This requires a complete application and thorough credit check, and you will need to provide additional documents.
Some of the advantages of get a mortgage pre-approval include:
- Give you a better idea of what you can borrow and afford
- Strengthen your offer
- Accelerate the closing process
- Giving you more time to compare lenders and rates and resolve any issues
How long does it take to get pre-approved
The time it takes to get pre-approved depends on the situation and the lender. In general, lenders require certain documents to verify your finances – such as your W-2s and bank statements – as well as verification of identity and employment.
They will also assess your debt-to-income ratio (DTI), perform a thorough credit check to obtain your credit score, and look for any red flags on your credit report.
Some of the factors that can affect the time it takes to get pre-approved include:
- How long do you need to collect the supporting documents
- If there are errors on your credit report that need to be corrected
- Your employment status (since you may need additional information if you are self employed)
- Unusual circumstances relating to your assets
Keep reading: Does mortgage pre-approval affect your credit score?
Having all the required documents on hand before you start can also help speed up the process.
Pre-approved with traditional lenders
It is not uncommon for a traditional lender to take up to 10 business days for pre-approval.
To get a sense of your financial situation and determine if you meet all of the requirements, a loan officer will comb through several pre-approval documents, including:
- W-2s (two-year value)
- Personal tax returns (two-year value)
- Company tax declarations (two-year value, if applicable)
- Recent payslips
- Asset Information (such as bank, retirement and brokerage account statements)
- Identification documents (such as a driver’s license, passport, or other government-issued ID)
- Profit and loss accounts (if you are independent)
Learn more: How to buy a house: step by step guide
Pre-approved with Credible
Credible offers a streamlined pre-approval process that allows you to get a pre-approval letter from multiple lenders at once. Rather than waiting days, you can find out how much you’re entitled to in minutes.
Our process is completely online and user-friendly, and you can quickly generate letters for sellers and your real estate agent directly from your account.
|How long does it take?||1 to 3 days||3 minutes|
|Credit check||Hard credit drawdown
(negative impact on your credit)
(no impact on your credit)
|Online process||Usually minimal; instead processed via an in-person visit to a branch or a phone call with a licensed loan officer||100% online|
|Compare several lenders?||No, visit multiple lenders to receive multiple pre-approval letters||Yes, pre-approved by multiple lenders at once|
|Several pre-approval letters to make additional real estate offers?||No, must submit another application to the lender for a new pre-approval letter||Yes, generate additional letters instantly with custom loan amount|
Ready to get pre-approved by Credible?
How long does a pre-approval last?
A mortgage pre-approval usually lasts between 60 and 90 days. Since your financial situation and the market can change, approval letters don’t last forever. If your offer is not accepted, you may need to get pre-approved again.
The expiration date of your pre-approval should be listed somewhere on your pre-approval letter. You will find this date on the first page of your Credible pre-approval letter.
If you need to make any changes to your simplified pre-approval letter (such as adjusting your down payment or purchase price), you can go to your dashboard and update the information, and we’ll generate a new letter for you.
If you’re serious about buying a home, you’ll want to get pre-approved. Not only will a pre-approval let you know what mortgage you qualify for, it will also give you an edge over other buyers and make the whole home buying process a lot less stressful.