Buyer's Guide:

Benefits of Mortgage

While looking at houses and dreaming of what your new home might be like can be fun, it can be a waste of time if it’s not practical as well. Mortgage pre-approval will help you understand how much banks will be willing to lend and give you an edge when it comes to negotiation.



What is Mortgage Pre-Approval?

Mortgage pre-approval is different from prequalification, which is simply an estimate of how much you might be eligible to borrow from an institution based only on the basic information you supply. To pre-approve you, lenders estimate how much you can afford and issue a letter, verifying your information and how much you can borrow. It demonstrates that you are a suitable candidate for a mortgage.

A mortgage pre-approval is not a contract and may have an expiration date. It does not constitute a commitment on either side and does not guarantee a loan, but it can expedite the process once you are ready to secure financing.

Why Do I Need to be Pre-Approved?

Mortgage pre-approval helps on many levels:

It will help you understand exactly how much you may be able to borrow and what your monthly payment will be. A mortgage pre-approval can also keep you from looking in a price range that is outside of your comfort zone while it gives you time to formally assess your current savings and debt.

Many offers are immediately rejected without mortgage pre-approval. Generally, sellers will not seriously negotiate with you unless they are sure you will qualify for financing.

Choosing a Lender

Before giving away any personal information, confirm that a lender is a licensed mortgage lender like Weichert Financial Services.

For lenders regulated at the state level, the NMLS Consumer Access site ( has information in all 50 states and Washington, DC. The site will confirm licensing information, how many years they have been licensed and whether your loan officer has been the subject of any state disciplinary proceedings. Most states also have their own department of licensing.

Nationally licensed institutions can be verified at or by phone at (800) 613-6743. Banks, savings banks and savings and loans that use Federal in their name or in the credentials following their name are subject to federal law. Information about federally regulated credit unions can be found on the National Credit Union Administration’s website,, or by calling (800) 755-1030.

Types of Lenders:

Mortgage brokers like Weichert Financial Services: They are an intermediary and not tied to any one lender. They can help you shop around because they know the details of all of the different lenders. Brokers like Weichert Financial also make the transaction much smoother for you by handling all of the paperwork and interactions.

Brick and mortar retail banks: These include large brand-name institutions and small local banks and credit unions.

Online banks: All information will be submitted electronically and interviews will happen via the telephone.

Online mortgage marketplaces: There are several online sites that will help you compare mortgage rates and products directly without the use of a broker.

Steps to Mortgage Pre-Approval


    Step One
    Let’s say, for example, that you’re working with Weichert Financial Services. Ask your Gold Services Manager what paperwork you should bring.


    Step Two
    Gather the appropriate paperwork, likely:

    • Pay stubs
    • W-2s
    • Federal Tax returns
    • Information about loans or other debt
    • 2 months bank statements of all type of accounts



    Step Three
    Present your paperwork, answer a few questions about your financial situation and about your plans for buying a home, such as a potential gift as a downpayment, a job change, debt not detailed in the paperwork, any other special circumstances, etc.


    Step Four
    Fill out the loan application.


    Step Five
    The loan officer reviews the application and the documents, verifies employment information and runs a credit check over the next few days.


    Step Six
    Pre-approval! The loan officer issues you a pre-approval letter for a specific amount, good until a specific date, which will serve as a guideline and as a mark of seriousness to sellers as you begin to search for your new home.

Key Takeaways:
Benefits of Mortgage Pre-Approval


To issue a mortgage pre-approval, a lender estimates how much you can afford and issues a letter, verifying your information and how much you can borrow.


Before giving away any personal information to a potential mortgage lender, confirm that a lender is licensed. For lenders regulated at the state level, go to Nationally licensed institutions can be verified at and federally regulated credit unions can be found at


Having mortgage pre-approval boosts your negotiating power; many offers are immediately rejected without it. A pre-approval from a well-known, respected lender like Weichert Financial Services will make your offer even stronger in the eyes of the seller.


Gaining mortgage pre-approval takes only a few days and often requires an application, a credit check and some paperwork, possibly including pay stubs, W-2s, Federal Tax returns, information about loans or other debt and bank statements of all types of accounts.