• Conventional mortgages issued through banks, credit unions, and mortgage brokers normally demand a 5% down payment (but private mortgage insurance must be purchased if the down payment is less than 20%).
• FHA loans for first-time home purchasers are backed by the Federal Housing Administration (FHA) and need as little as 3.5% down.
• VA loans are available with no down payment to veterans, service members, and their qualifying surviving spouses through the Department of Veterans Affairs (VA).
• USDA loans are offered with no down payment to low-income borrowers purchasing homes in rural parts of the United States.
Finally, an application fee of up to several hundred dollars may be required.
Pre-approval letters are normally generated within a day of your application being submitted. Pre-approval may take up to two weeks if you are self-employed or if the lender requires additional verification of any portion of the application.
How Long Is a Mortgage Pre-approval Good For?
Your pre-approval letter will say that the pre-approval is only valid for 60 or 90 days from the day it was prepared.
A pre-approval document’s financing terms are not guaranteed; however, a pre-approval application fee may include a rate lock-in that is guaranteed for the duration of the pre-approval letter.