Rach Realty Reader

Looking to buy a Home - Step 1. Get Preapproved for a mortgage

Now that you have me as your trusted Realtor, the next step in buying your home is getting preapproved by a mortgage lender. This is non-negotiable—we can’t submit an offer on a home unless you’ve been preapproved. More importantly, this step gives you a clear understanding of your buying power, what your monthly payments will be, what interest rate you qualify for, and what to expect for taxes and other costs.

To make the mortgage process less overwhelming, here’s a fantastic booklet I highly recommend all buyers read before applying for a mortgage.

Why Choosing the Right Mortgage Lender Matters

Not all mortgage lenders are created equal. A great lender will ensure a smooth transaction, while a bad one can turn the process into a total nightmare—delaying your closing or even jeopardizing your home purchase altogether. Worse, choosing the wrong lender could cost you thousands over time if you get stuck with a higher interest rate.

You don’t want to lose out on your dream home because of an unorganized lender who drops the ball during underwriting. That’s why working with the best matters!

Click here for my recommendations!

Documents You Need for Preapproval

Every lender has slightly different requirements, but in general, here’s what you’ll need:

Completed Loan Application (your lender will provide this)
Asset Statements – Two most recent months (or a quarterly statement) for all accounts listed on the application (checking, savings, 401k, mutual funds, stocks, IRAs, brokerage accounts, etc.)

Income Verification:

  1. W-2 Employees: Two most recent pay stubs + past two years’ W-2s
  2. Self-Employed (25%+ ownership): Past two years of business tax returns + personal tax returns


Federal Tax Returns: Past two years
Additional Documentation: Some lenders may request further paperwork depending on your financial situation.

Getting a Preapproval Letter

Once you submit your documents, expect your preapproval letter within 2-3 business days (unless additional documentation is needed). After the 2008 housing crash, lenders became way more strict, so don’t be surprised if they ask for more paperwork—it’s just part of the process.

💡 Pro Tip: Your preapproval letter will show the loan amount you qualify for, but be sure to ask your lender what that translates to in terms of monthly payments, including PMI, taxes, and insurance. You want to be comfortable with your monthly housing cost!

Once you receive your preapproval letter, send me a copy so I have it ready when we submit an offer.

Understanding Loan Estimates & Closing Costs

After you get preapproved, your lender is required to send you a Loan Estimate (LE) within three days. This document breaks down your expected closing costs, which are in addition to your down payment.

💰 Typical closing costs = ~2.5% of the purchase price.
For example, if you’re buying a $500,000 home and putting down 20%, you’ll need $112,500 cash at closing ($100K down payment + ~$12,500 closing costs).

📝 Your lender can provide a more detailed breakdown based on your specific loan.

Should You Shop Around for a Mortgage?

YES. 100%. Absolutely.

Every lender has different fees and interest rates, so you should get quotes from at least two lenders. But here’s the trick:

📌 Have all lenders pull your credit on the same day (or within 24 hours). This minimizes the impact on your credit score.
📌 Compare interest rates on the same day—rates fluctuate daily, so checking on different days is like comparing apples to oranges.

Next Steps? Let’s Get You Preapproved!

If you haven’t started this process yet, let’s connect ASAP so I can introduce you to some trusted lenders. Once you're preapproved, we can start touring homes and get you closer to making an offer on your dream home!

Step 1 Buying a Home