Home Buying

Pre-Qualifying for a Mortgage

Know your budget. Before you even consider where you’d like to live or what kind of home you’re looking for, it’s a good idea to get pre-qualified or pre-approved for a mortgage. In some states, you can go to a mortgage broker, who’s job is to help you determine what you are qualified for and then find you the best financing terms. Alternatively, you can go directly to a bank and see what they are willing to lend, although we would recommend shopping around at least a few different banks. The difference could be $1,000’s of dollars over decades.

In any case, you should have a comfortable range of prices that you are qualfied to buy. Always remember, just because you can get a larger mortgage doesn’t always mean that you should. Consider future changes to your income, your willingness to commit to a very long-term financial obligation, and your current monthly cash flow. Click here to learn the details.


Let’s look at some specific questions sent in by DearMonty readers from across the country. Read more Q&A articles about the “Pre-Qualifying for a Mortgage” stage of the Home Buying process:

  1. Will a real estate agent blow me off without loan pre-approval? I have a good job and credit score so why do that before I need a loan?

    Reader Question: I want to start looking for a home, but several people suggested agents won’t take me seriously without a pre-approval letter. I understand the pre-approval must be updated every 30 days, and a credit check hurts my credit score. How do I avoid being punished for planning ahead and beginning my search far […]

  2. Do you recommend any loan modification companies?

    Reader Question: What do you know about a company called “name omitted”? Can they really help? Are they a legitimate company? Monty’s Answer: Hello Ely, and thanks for the question. I do not recommend or rate businesses, but some comments and suggestions may be helpful. Background is important. Companies like the one being questioned specialize […]

  3. Mortgage loan pre-approval in today's real estate market is a must if you plan on financing your purchase

    A mortgage loan pre-approval from a lender has gained more importance in real estate transactions than ever before. Mortgage lending has been affected the past several years with a heightened level of regulation in an attempt to prevent the types of abuses they believe created the real estate meltdown that began around 2008. Appraisal restrictions, […]