Get Preapproved for Your Michigan Home

No. CFPB explains that prequalification and preapproval letters say a lender is generally willing to lend up to a certain amount based on certain assumptions, but they are not guaranteed loan offers. Final approval comes later, after the lender verifies your information, reviews the specific home (including the appraisal), and completes underwriting.

A lender's credit check is recorded as an inquiry, which typically has a small effect on your scores. According to CFPB, multiple mortgage credit checks within a 45-day window are recorded as a single inquiry, so you can shop with more than one lender. Checking your own credit does not affect your scores.

It varies by lender. Freddie Mac notes that letters generally remain valid for about 30 to 90 days, and some lenders use other periods. Separately, the documents behind it age: Fannie Mae's Selling Guide requires credit, income, employment, and asset documents to be no more than four months old on the note date. If your search runs long, plan on an update.

Lenders typically ask for recent pay stubs, W-2s (or 1099s), tax returns when needed, recent bank and investment statements, and information about your debts, and they'll pull your credit with your permission. Self-employed buyers and buyers using other income usually need additional documents. Your loan officer will tell you exactly what applies to you.

Your debt-to-income ratio (DTI) is your total monthly debt payments, including the new house payment, divided by your gross monthly income. CFPB's example: $2,000 in monthly debts divided by $6,000 in gross income is 33%. Limits vary by loan program and lender.

Often, yes, depending on the loan program. Lenders typically require a signed gift letter stating that no repayment is expected and documentation of the transfer. For example, Fannie Mae's Selling Guide lists who can give a gift and what the gift letter must include.

It depends on the loan program and the lender. For FHA loans, HUD guidelines allow maximum financing (3.5% down) with a decision credit score of 580 or higher, and limit scores from 500 to 579 to 90% financing. Other programs and lenders set their own requirements, so a personalized review is the best way to know where you stand.

It usually helps. A preapproval gives you and your Realtor a realistic price range, and many Michigan listing agents expect a preapproval letter with an offer. CFPB also notes that getting preapproved earlier can help you spot credit issues in time to correct them.

Tell your loan officer right away. A new job, new debt, large deposits, or a change in price, loan type, or property type can change what you qualify for. Fannie Mae's guidelines, for example, require a loan to be re-underwritten when new debt or reduced income pushes the debt-to-income ratio beyond allowed tolerances.

Yes. CFPB says you can shop around and get multiple preapprovals and official Loan Estimates, and comparing Loan Estimates for the same kind of loan is one of the best ways to see whether an offer is competitive.