How Long Does a Mortgage Pre-Approval Last? Explained
Get the answer to a key question about mortgage pre-approval. Learn how long a mortgage pre-approval letter lasts and how much it really means.
What Is Mortgage Pre-Approval?
Mortgage pre-approval is a letter from a lender that signifies that you've been approved for a loan, and details the amount they're willing to lend to you. This letter helps home buyers better understand how much they can afford and demonstrates to sellers that they can qualify for financing. Mortgage pre-approval is also the first step in the home buying process.
How Long Does Mortgage Pre-Approval Last?
Mortgage pre-approval is generally valid for 60 to 90 days. During this period, lenders will check the buyer's financial situation, including credit score, income, debts, and assets. If all of these remain unchanged, then lenders may honor the pre-approval terms. However, since lenders may change their requirements during this time, it is important for buyers to stay in close contact with their lender.
The length of the pre-approval period can vary depending on the type of loan, the lender, and other circumstances. Some lenders will extend the pre-approval period if the buyer can provide updated documents or information that proves their financial situation has not changed.
What Happens After the Pre-Approval Expires?
If the pre-approval expires, it's important for buyers to go through the process again and obtain a new pre-approval. This will show sellers that they are still capable of buying a home, and it will give the buyer a better understanding of how much they qualify for. A new pre-approval may also be necessary if the buyer didn't follow through on the original offer, such as if they decided to look for a different home.
When reapplying for a mortgage pre-approval, buyers will need to provide the lender with updated documents and information to have their financial picture reevaluated. This includes income statements, bank statements, tax returns, and other pertinent paperwork. The re-approval process can generally be completed within a few days.
Conclusion
Mortgage pre-approval is a necessary step in the home buying process that helps buyers understand what they can afford and gain the upper hand when competing with other buyers. While pre-approval letters typically last for 60 to 90 days, buyers should periodically check in with their lender to make sure they are still eligible for the loan, as lender requirements can change over time. If the pre-approval expires, buyers will need to obtain another one in order to confirm their financial situation is still valid.