Steps in Pre Approval
Difference between FHA & CONVENTIONAL loan products
I can help explain the approval process for FHA and conventional mortgages.
FHA (Federal Housing Administration) mortgages are backed by the government and are designed to help people with lower credit scores or smaller down payments qualify for a home loan. The approval process for an FHA mortgage typically involves the following steps:
Pre-approval: You will need to provide information about your income, assets, and credit history to a lender who will evaluate your eligibility for an FHA loan.
Property appraisal: The lender will require an appraisal of the property you wish to purchase to ensure that it meets FHA standards for safety and habitability.
Underwriting: The lender will review your application and supporting documents to ensure that you meet the FHA's eligibility requirements.
Loan approval: If your application is approved, the lender will provide you with a commitment letter stating the terms and conditions of the loan.
Conventional mortgages, on the other hand, are not backed by the government and typically require a higher credit score and larger down payment than FHA loans. The approval process for a conventional mortgage typically involves the following steps:
Pre-approval: You will need to provide information about your income, assets, and credit history to a lender who will evaluate your eligibility for a conventional loan.
Property appraisal: The lender will require an appraisal of the property you wish to purchase to ensure that it is worth the amount you are borrowing.
Underwriting: The lender will review your application and supporting documents to ensure that you meet the eligibility requirements for a conventional loan.
Loan approval: If your application is approved, the lender will provide you with a commitment letter stating the terms and conditions of the loan.
In general, the approval process for both FHA and conventional mortgages can take several weeks to complete, and the specific requirements and timelines may vary depending on the lender and the type of loan you are seeking. It is important to work closely with your lender throughout the process to ensure that you understand all of the requirements and are able to provide the necessary documentation in a timely manner.
Paul Defngin explains FHA & Conventional Mortgages in the approval process #real_estate
