Posted on: 19th Jan, 2014 11:51 pm
Will I be able to qualify for a mortgage over the amount that I have been pre-approved for?
Well, as far as I know, you will not be able to qualify for a mortgage amount more than the pre-approved amount.
You may be able to get a mortgage for more than the amount for which you were pre-approved.
A pre-approval depends upon some factors which are not known at the time of the pre-approval. For example, if you find a home that has property taxes less than the guestimated amount for the pre-approval, you may qualifiy for a higher mortgage amount.
Similarly, maybe home insurance monthly premiums may be less than guestimated.
Maybe mortgage rates dropped from the time of your pre-approval and you could qualify for more of a mortgage. Each of the above items could be higher or lower and affect the mortgage amount up or down.
However, the BIGGEST chance of a higher mortgage amount is if the lender can get you an approval at a higher debt ratio. Many lenders issue a pre-approval based on a maximum debt ratio of 43% or 45%. Higher debt ratios are available but ONLY after the automated underwritng is run and the lender gets an automated approval for a higher debt ratio, maybe up to a 50% debt ratio.
If you know you need/want a mortgage amount higher than your pre-approval, ask a lender/broker to qualify you up to a 50% debt ratio, if possible. The lender/broker will have to run the automated underwriter to make sure it is OK.
The lender/broker may or may not be able to do that. I do it all the time. Simply find a lender/broker who can do it.
The automated underwriting findings may or may not approve a debt ratio for you over 45%. It depends on a combination of factors--credit score, down payment, reserves, etc.
A pre-approval depends upon some factors which are not known at the time of the pre-approval. For example, if you find a home that has property taxes less than the guestimated amount for the pre-approval, you may qualifiy for a higher mortgage amount.
Similarly, maybe home insurance monthly premiums may be less than guestimated.
Maybe mortgage rates dropped from the time of your pre-approval and you could qualify for more of a mortgage. Each of the above items could be higher or lower and affect the mortgage amount up or down.
However, the BIGGEST chance of a higher mortgage amount is if the lender can get you an approval at a higher debt ratio. Many lenders issue a pre-approval based on a maximum debt ratio of 43% or 45%. Higher debt ratios are available but ONLY after the automated underwritng is run and the lender gets an automated approval for a higher debt ratio, maybe up to a 50% debt ratio.
If you know you need/want a mortgage amount higher than your pre-approval, ask a lender/broker to qualify you up to a 50% debt ratio, if possible. The lender/broker will have to run the automated underwriter to make sure it is OK.
The lender/broker may or may not be able to do that. I do it all the time. Simply find a lender/broker who can do it.
The automated underwriting findings may or may not approve a debt ratio for you over 45%. It depends on a combination of factors--credit score, down payment, reserves, etc.
