How to Get Preapproved for a Mortgage: A Step-by-Step Guide

Getting preapproved for a mortgage is one of the smartest moves you can make before shopping for a home. Not only does it show sellers you’re serious, but it also gives you a clear picture of what you can afford—so you don’t waste time looking at homes outside your budget.

Here’s a step-by-step guide to help you through the process.

What Is Mortgage Preapproval?

Mortgage preapproval is a written statement from a lender stating how much you’re likely to be approved to borrow based on a review of your finances, credit, and documentation. It’s stronger than prequalification, which is based on unverified info.

According to the Consumer Financial Protection Bureau (CFPB), a preapproval usually requires a full credit check and supporting documents—making it a powerful tool for homebuyers. My job in this process is to remove as much uncertainty as possible so that you can shop and make offers confidently.

🧭 Step-by-Step: How to Get Preapproved

1. Check Your Credit Score

Your credit score plays a major role in what loan types and interest rates you’ll qualify for. Most conventional loans require a score of at least 620, though FHA loans allow for lower scores. We can go over more of this when we discuss your specific objectives.

📘 I suggest that you do two things as you prepare for getting pre-approved.

1. First, check your free credit reports at www.AnnualCreditReport.com—the only site authorized by federal law.
2. Second, before having your credit pulled, put yourself on the “Do Not Call” list with www.optoutprescreen.com — this will keep your contact information from being sold by TransUnion, Equifax and Experian.

2. Calculate Your Budget

Before talking to a lender, know how much you can comfortably afford based on your monthly income, existing debts, and down payment. Aim for a debt-to-income (DTI) ratio below 43% for the best approval odds. You can go higher with some loan programs but keeping your DTI around this 43% mark gives you room to breathe, financially.

I’ve told anyone I work with that the difference between what you can be pre-approved for and what you can afford is the difference between occasionally eating out and taking vacations and being a homebody that gets by on ramen or rice.

You can use this tool to model monthly payments based on different scenarios. Spend some time deciding what you can truly afford and be sure to factor in all your revolving and installment debt (these when added to your principal and interest payment will be used to calculate your DTI). What doesn’t count toward your DTI are your living expenses, but you should consider your living expenses, like, groceries, utilities, homeowner’s insurance, property taxes, and other living expenses. Factoring in these things will give you a better picture of what it will take to live in your new home.

3. Gather Financial Documents

Lenders will ask for the following documents to verify your income, assets, and creditworthiness:

• W-2s or 1099s (past 2 years)
• Past 2 years of Federal tax returns (if you are self-employed)
• Recent pay stubs (last 30 days)
• Bank statements (last 2 months)
• Driver’s license and Social Security number

Having these ready speeds up the preapproval process significantly.

4. Apply for Preapproval

You can usually apply online, over the phone, or in person. During the application, the lender will:

• Pull your credit report
• Review your documentation
• Assess your loan eligibility

If approved, you’ll receive a preapproval letter—typically valid for 60–90 days. This letter is often required when submitting an offer on a home.

5. Stay Mortgage-Ready

Once you’re preapproved, avoid major financial changes like:

• Taking on new debt (e.g., financing a car)
• Changing jobs (same line of work is okay but don’t change to a completely line of work.)
• Making large bank deposits without a paper trail (anything over $2,000 needs to be fully documented).

Lenders will reverify your finances before closing, so keeping your profile stable is key.

Final Thought

Getting preapproved is more than just a formality—it gives you a competitive edge and financial clarity during your home search. Whether you’re just getting started or ready to make an offer, following these steps will ensure you’re prepared and positioned for success. 🔗 Want to go deeper? Schedule a call with me today!