Prequalifying shows you how much you can afford to spend on a home based on where you stand financially, taking into account your income, debt and savings, among other factors. Lenders also consider current interest rates.
- An estimate of the home purchase price and monthly mortgage payment you can afford and qualify for
- How much money you’ll need for a down payment (the difference between the purchase price and the amount of your mortgage)
- Saving goals you need to set and achieve
Who can help me prequalify?
A loan officer or home-purchase education counselor can help you prequalify.
Prequalifying is not a commitment on your part to work with a particular lender or real estate agent, and it doesn’t guarantee you a loan on the lender's part – that all happens during the actual loan application process. But prequalifying can help you narrow your house hunt and avoid potential disappointment.