Navigating the world of home buying can be both exciting and overwhelming, especially when it comes to securing a mortgage. One of the first steps in this journey is getting pre-qualified for the mortgage loan, a step which can significantly strengthen your position as a serious buyer. This process not only gives you a clearer picture of your financial standing but also helps you understand how much you can afford to spend on a home. In this blog, we will guide you through the essentials of getting pre-qualified with BankIowa, so you can embark on your home buying adventure with confidence!

Getting Started

Let’s start with your credit score! Your credit score is a significant factor in determining your mortgage interest rate and loan eligibility. Before applying for pre-qualification, it's wise to check your credit report from all three major credit bureaus (Equifax, Experian, and TransUnion). You can obtain free copies annually at AnnualCreditReport.com. Review your reports for any errors and take steps to correct them, if necessary, before applying for a mortgage. It is also a good idea to know your FICO or VantageScore credit score before entering the mortgage loan process.

Check out our Mortgage Qualification Calculator which can help give you an idea of how much house you can afford.

BankIowa Online Mortgage Application

To get pre-qualified, prospects should submit a mortgage loan application online and send an email with information to your preferred BankIowa mortgage loan originator. If additional information is needed for clarification, we may ask for it to be shown in documentation. We will need information on your employment history, your current pay, your debt, and your assets available to help with down payment and closing costs.

We will also pull a hard credit inquiry of your credit report. Please ensure that if there is any undisclosed debt, it will not show up on your credit report. Also, provide this information to your mortgage loan originator so they can ensure that they are calculating an accurate debt-to-income ratio.

BankIowa Online Mortgage Application Tips:

  • You do not need to include vehicles in your assets
  • In the liabilities/debts section, leave the section blank
    • When the mortgage loan originator pulls your credit report, that information will auto-populate into the section
  • If you plan on placing a down payment, let the mortgage loan originator know the source of it

What to Expect After Pre-Qualification

Assuming all goes well and you are pre-qualified, we will provide a letter for you to provide your realtor as part of your offer. If an offer is accepted and a Purchase Agreement is received, we will then begin the origination process and gather the documentation to process the mortgage. Some examples of documentation include:

  • 30-days most recent consecutive pay stubs (if paid weekly provide 4, if paid bi-weekly provide 2)
  • Last two years of W-2’s, 1099’s (if applicable), and K1’s (if applicable) from all Employers
  • Last two years of Federal Tax Returns
    • Most recent two consecutive months Bank Statement(s)
  • Please be sure to provide complete documents including all pages. This is for any banking institution outside of BankIowa
  • Insurance Agent’s Name & Contact information (If you have chosen one already)
  • Driver’s License for you and any co-borrowers (Color copy)
  • If you have been through a divorce, provide a complete (all pages) copy of the “Recorded” Divorce Decree and Stipulation
  • If you are required to pay child support or alimony
  • If you are a veteran, self-employed, or a recent graduate/current student (if applicable, additional documents may be needed)

Conclusion:

Getting pre-qualified for a mortgage loan is a crucial step in the home buying process. It provides you with a realistic understanding of your budget, making your home search more focused and efficient. If you’re searching for a mortgage loan, talk with one of our trusted mortgage loan originators today at your nearest BankIowa branch!