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. Our friends just had their loan canceled by the lender. They are crushed. How can a lender cancel a loan they already approved?

    Reader Question: Our friends are homebuyers devastated. Their lender pulled the plug just before closing. We are in the process of closing on our first home purchase. We are excited but at the same time very edgy. Our friends were a week ahead of us on their home purchase. They didn’t offer details, but how […]

    May 24, 2021
  2. My agent is insistent I use their recommended lender when I found a better option. Am I breaking some unwritten rule?

    Reader Question: My offer was accepted, and I was thrilled. Before making the offer, my agent had instructed me to obtain a pre-approval letter and recommended I use a particular loan officer. I went ahead and did so after confirming with the loan officer that doing so wouldn’t lock me into using his services. I […]

    November 23, 2015
  3. 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 […]

    September 30, 2014
  4. 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 […]

    May 28, 2013
  5. 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, […]

    September 2, 2011