June 3, 2013

Don’t let this happen to you: Get an Illinois Mortgage Pre-Approval

Illinois mortgage pre-approval - United Home Loans

If you live in the great Land of Lincoln, chances are you have heard a mortgage horror story like this before. A couple you know found the perfect new home in the Chicago area – perhaps a new condo in Lincoln Park or a spacious home on a big lot in a suburb such as Naperville. They were very excited about this great deal on the home price and felt they could definitely afford the 30-year fixed mortgage payment. They told all of their friends, brought their parents along on the inspection and started picking out furniture and appliances for their new home. But they made one huge mistake – they did not get a legitimate Illinois mortgage pre-approval and they were denied for their mortgage loan.

Borrowers can be denied for a wide variety of reasons – maybe they forgot to pay a Hinsdale parking ticket and it went to collection, they did not mention the business expense they write off on their tax returns or did not realize that commission and bonus income typically needs to be consistent and earned for two years for a lender to use as part of their qualifying income. Sometimes a loan can be denied for reasons that are totally out of the borrower’s control, such as an appraised value that comes in below the sales price. Many pre-approvals will simply not cover all of these items because borrowers are in a hurry and just want a quick pre-approval in order to make their offer.

So what should you do? Get fully pre-approved before you look for a home. And make sure it is a legitimate pre-approval with a review of credit, income and assets. Also, make sure the loan has been pre-approved through an automated underwriting engine such as Fannie Mae’s Desktop Underwriter or Freddie Mac’s Loan Prospector. Almost all lenders have access to these underwriting engines and use them daily. This of course means a little bit more work upfront – you will need to provide your last two pay stubs, last two W2s and federal tax returns, bank and investment statements to show where your down payment funds are coming from and any credit-related documents (if applicable) such as a divorce decree or bankruptcy discharge papers.

Don’t suffer the heartbreak associated with a mortgage denial, especially after you have found the perfect home. You will be better prepared and be able to make a much better buying decision once your Illinois mortgage pre-approval is in hand. Contact us below or at 708-531-8388 to get started.


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