Do you want to know how much home you can afford and what interest rate you will be pre-approved for? Get an idea of what you might qualify for before diving into the full application process.
Ask a mortgage lender for a soft pull pre-approval, it typically means you’re requesting a preliminary assessment of your creditworthiness and eligibility for a mortgage loan. A soft pull, also known as a soft inquiry or soft credit check, is a type of credit check that doesn’t impact your credit score. Here’s what happens during the process:
- Information Gathering: You’ll provide the mortgage lender with basic information about your financial situation, such as your income, employment history, assets, and debts. This helps them understand your financial capacity to repay a mortgage.
- Credit Check: The lender will perform a soft pull on your credit report. This type of credit check does not affect your credit score and won’t show up as an inquiry on your credit report.
- Preliminary Assessment: Based on the information you provide and the soft credit check, the lender will give you a preliminary estimate of how much you might qualify for and the terms of the mortgage, including the interest rate.
- Pre-Approval Letter: If your financial situation seems to align with the lender’s criteria, they may issue you a pre-approval letter. This letter is not a guarantee of a loan but indicates that, based on the information provided, you are likely to qualify for a mortgage up to a certain amount.
- Document Verification: Keep in mind that a soft pull pre-approval is not a final approval. To proceed with a mortgage application, you will need to provide more detailed documentation to verify your financial information, such as tax returns, pay stubs, bank statements, and more.
- Hard Pull for Final Approval: Once you decide to move forward with a specific loan, the lender will perform a hard pull, also known as a hard inquiry, on your credit report. This type of credit check can impact your credit score slightly. A hard pull is necessary for the lender to make a final decision and provide you with a formal mortgage offer.
It’s important to note that the terms of a mortgage can change between the pre-approval stage and the final approval, especially if your financial situation changes or if the lender conducts a more thorough review of your finances. Therefore, while a soft pull pre-approval can give you an idea of your potential eligibility, it’s not a commitment to lend and should be followed by a more comprehensive application process for a complete assessment.
Contact us to connect with a lender who can perform a preliminary credit check for your home loan eligibility without impacting your credit score.