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How do you know when a pre-approval letter is legitimate?

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Anonymous
Not applicable

How do you know when a pre-approval letter is legitimate?

 
Message 1 of 7
6 REPLIES 6
Anonymous
Not applicable

Re: How do you know when a pre-approval letter is legitimate?

Hello,

 

Expect a turn time of 24 hours or less if the requested documentation is organized and provided up front. For example, if you were to provide a loan officer all the needed information in the morning, you could potentially have an answer that afternoon. Pre-approvals don’t typically take more than a couple days even in busiest market conditions (a spike in application volume). Underwriters may request additional documentation, but that shouldn’t cause much of a delay.

 

Message 2 of 7
Anonymous
Not applicable

Re: How do you know when a pre-approval letter is legitimate?

Looks fine to me.


@Anonymous wrote:

Hi everybody, this might be a dumb question but how do you know a mortage pre-approval letter is legit? I have been shopping loans and used zillow mortage search to compare a few companies rates. The best rate ended up being a comapny called homepoint financial, which is a company that has excellent reviews and as far as I can tell completely legitimate. I submitted all my w-2's, paystubs, bank statements, gift letter etc to my loan officer after told him I would like to get a preapproval letter. He received the information and eventually sent me back a document titled "pre-approval notification". The reason why i'm questioning its validity is because throughout the actual document it says i am "prequalified" for the amount but never mentions preapproval except in the heading. What does a standard preapproval letter contain? I was under the impression a preapproval letter had to be signed by an underwriter. Am I just being overly suspicious? Thanks so much for your help.

 

For those curious here is what the preapproval letter says (with all personal information redacted of course):

Loan Identification Number: #########
Date: 4/24/2017

PRE-APPROVAL NOTIFICATION

Borrower(s): WHERETHEGOLDAT

Address: TBD

We are pleased to notify you that your loan application for the following mortgage has been pre-qualified: Purchase Price:
$ 300,000.00 Loan Amount:
$ 250,000.00 Loan Type:
Conventional

 

The pre-qualified loan amount is based on current market rate and terms and is subject to change upon the execution of a Rate Lock-In Agreement. This Pre-Qualification Notification will remain valid for 45 days from the date this notification as indicated at the top of this document, provided there are no material changes in your financial status. This Pre-Qualification Notification is not a commitment to lend you; a loan commitment can only be issued by Home Point Financial Corporation as and when the conditions set forth below are met: Home Point is in Receipt of a complete and fully executed 1003 loan application. Credit Score and Debt To Income have been reviewed and are in great standing. Receipt and underwriting approval of a fully executed purchase/builder contract A satisfactory appraisal report completed by an appraiser approved by Home Point Financial Corporation An acceptable flood certification and proper insurance binder as applicable Proof of clear and unrestricted title In addition to the above standard conditions, your Pre-Qualification is subject to the following conditions being met by you before settlement can occur: Employment/Income: Employment and income status must remain the same as of the date of this Pre-Qualification Notification.

 

Credit: Credit status must remain the same as of the date of this Pre-Qualification Notification.

 

Funds to Close: At Closing, sufficient and verifiable funds are required to satisfy down payment, closing costs, and any other associated costs without resorting to secondary financing.

 

Underwriting Conditions: All documentation required to complete processing your loan application. Any agreement to make you a loan or a commitment to lend to you is conditioned upon your satisfying various preconditions prior to closing in addition to those set forth above, including any other conditions which are required to be met at or before a residential mortgage loan closing, either as customarily required in a residential mortgage loan closing or as dictated in the discretion of Home Point Financial Corporation by your particular circumstances. No verbal representation by anyone concerning your qualification for a loan from Home Point Financial Corporation is effective or binding on our company. Moreover, the terms of this pre-qualification notification can only be changed by Home Point Financial Corporation in writing signed by our company, and no other modification is effective or binding on our company. If you have any questions, feel free to contact our office.

 

Very Truly Yours,

Generic Loan Guy Name, NMLS ####


 

Message 3 of 7
ShanetheMortgageMan
Super Contributor

Re: How do you know when a pre-approval letter is legitimate?

It's good to wonder how your loan officer pre-approves you. 

 

A great question you can ask, is how do they know your loan won't have any problems when it comes to an underwriter reviewing it?  They should be able to easily articulate why.  You should also ask, do they have any doubts, and if so, what are they?  Then after discussing those answers, you and your loan officer can determine if your loan needs to be sent to the actual unerwriter or not, prior to you making an offer on a home.

Free Mortgage Advice & Pre-Approvals (FHA, VA, USDA, Fannie, Freddie, Non-Prime, Construction, Renovation/Rehab, Commercial) since 2002
Located in Southern California and lending in all 50 states
Message 4 of 7
krielly
Established Contributor

Re: How do you know when a pre-approval letter is legitimate?

This looks to be a "pre-qualified" letter, vs a "pre-approved".


You can't have your cake and eat it too. But you can dip your finger in the bowl and lick the icing!
Message 5 of 7
Anonymous
Not applicable

Re: How do you know when a pre-approval letter is legitimate?

It says here:  PRE-APPROVAL NOTIFICATION

 


@krielly wrote:

This looks to be a "pre-qualified" letter, vs a "pre-approved".


 

Message 6 of 7
krielly
Established Contributor

Re: How do you know when a pre-approval letter is legitimate?

seems like the terms are intermixed within this "notification". At one point it states "This pre-qualification notification" within the text....

 

 


You can't have your cake and eat it too. But you can dip your finger in the bowl and lick the icing!
Message 7 of 7
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