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Receiving pre approval for your home loan means that a lender has reviewed your financial situation and determined that you are eligible for a loan of a certain amount. This is useful as it lets you know how much you can spend on your new home. However, it’s important to understand what to do with a pre approval for a loan to make the most of it.
How To Navigate Loan Pre Approval
UNDERSTAND THE TERMS AND CONDITIONS
The pre approval will outline the terms and conditions of the loan, such as the interest rate, repayment period, and any fees associated with the loan. Make sure you understand these terms and conditions thoroughly, as they will impact your ability to repay the loan.
Just because you have pre approval from one lender does not mean that you should automatically accept their offer. Take the time to shop around not only to compare rates and terms but to ensure you are working with the right lender for you.
DETERMINE YOUR BUDGET
With your pre approval in hand, you’ll have a better idea of what you can afford. Use this information to create a budget that takes into account your monthly loan payments as well as your other expenses. Be sure to factor in any additional fees or charges associated with the loan.
Once you’ve decided on a lender and loan, you’ll need to provide documentation to support your application. This may include pay stubs, tax returns, and financial statements. Make sure you have all of these documents readily available to speed up the loan approval process.
ALWAYS READ THE FINE PRINT
Never skip this step. Before signing any loan documents, make sure you read the fine print carefully. This will help you understand any potential fees or penalties that may be associated with the loan.
Pre-approval for a loan can be a helpful tool, but it’s important to understand what to do with it and how to make the most of it. Armed Forces Bank (AFB) is a trusted partner of MilHousing Network because they are a full-service military bank committed to serving those who serve since 1907. AFB provides affordable, personal, and convenient banking and financial services to active and retired military members and their families as well as veterans in all 50 states. Member FDIC.
This article is sponsored by Armed Forces Bank. AFB can help you find the home loan or refinance option that’s right for you—all with less stress, thanks to our mortgage service guarantee. We promise to close your loan on time or pay you $1,000. Restrictions and requirements apply. Subject to credit approval. Member FDIC.
Brandy Hall, Nurse Writer, turned a passion for patient teaching into content writing. By creating easy-to-understand patient education content, she helps people understand their health without complex terms and jargon. She is published on Sleep.com, Healthnews, SingleCare, and more.